XRP holders could earn new yield, but getting out may take up to 60 days

CryptoSlate reports that the Flare-based protocol Firelight plans to allow holders of XRP-linked assets to earn yield by depositing FXRP into a vault to back DeFi coverage. While depositors could earn premiums, withdrawals may take between 30 and 60 days once 30-day coverage periods launch. According to CryptoSlate, rewards stop when unstaking begins, and eligible claims tied to the period when the collateral backed coverage can reduce the FXRP returned. Firelight features a protocol-owned stablecoin reserve called the First-Loss Buffer to absorb validated claims before staked FXRP is affected. DefiLlama data showed $71.74 million in Firelight total value locked as of a Sept. 13 snapshot, though the timing of the coverage system rollout remains unconfirmed. CryptoSlate notes that deposits demonstrate capital availability rather than whether the coverage business can generate enough income to make the risk worthwhile. Customers pay premiums for protection, which are converted into FXRP and added to depositor positions. However, the system relies on paying customers to generate sustainable income after incentives fade, and completed redemptions return FXRP on Flare rather than native XRP directly on the XRP Ledger.