Firelight forces XRP-linked tokens lockup as withdrawal delay queue grows
Firelight activated its DeFi coverage model on Flare on Oct. 6, automatically moving existing staked FXRP into a phase where pooled capital backs claims at covered vaults. Stakers can earn fee-funded returns but face pro-rata slashing risk beyond a first-loss stablecoin buffer, and their FXRP may take 30–60 days to withdraw; claims from the prior backing period can still reduce withdrawals. Initial settlements allocated $38 million of cover and charged about $56,914 in premiums. Firelight’s reported buffer held roughly $1 million in USDT0, but liabilities and pending claims were not reconciled, so its adequacy is unclear. A decline in XRP’s price can also reduce the dollar value of backing assets. The long-term return for stakers depends on premiums and ongoing claims, while existing rewards stop accruing when unstaking begins.
