Phase 1 introduces liquid staking for XRP as developers prepare a full insurance-driven rewards model for early 2026
Firelight Finance has launched a new XRP staking protocol on the Flare network, introducing a liquid token called stXRP designed to support an emerging DeFi insurance framework. The rollout marks a significant step toward expanding XRP’s role in decentralized finance, though staking rewards will not activate until the next development phase.
In its initial phase, users can bridge XRP to Flare using the FAssets system, deposit FXRP into Firelight, and receive stXRP on a one-to-one basis. The token already circulates within the Flare ecosystem and can be used in DEX trading, lending platforms, and liquidity pools. However, rewards will only begin in Phase 2, expected in early 2026, contingent on DeFi protocols adopting Firelight’s on-chain insurance model.
Firelight’s approach draws from the concept of restaking, but applies it differently than previous Ethereum-based attempts. “We focus on assets with a structurally lower cost of capital, like XRP, instead of trying to outcompete ETH DeFi yields,” said Firelight chief strategy officer Connor Sullivan. He emphasized that the team is targeting DeFi cover and insurance as a single, high-conviction use case supported by real risk modeling.
The system is backed by Sentora, Firelight’s incubator formed from the merger of Into and Trident Digital. Sentora has long provided risk-management frameworks for protocols with billions in total value locked. “DeFi cover is an essential feature, not a nice-to-have,” Sullivan noted, adding that Firelight is in active integration talks with several platforms.
If protocols adopt the cover module, they will pay insurance fees, a portion of which will be distributed to XRP stakers as rewards. The model is chain-agnostic, enabling any protocol across blockchains to purchase coverage.
Firelight says its near-term focus is on building liquidity and preparing the automated claims process for full activation in Phase 2, aiming to strike a fair balance between staker rewards and protocol costs.
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