Firelight, an onchain protection protocol, said it has unstaked and returned funds to their original addresses after some deposit addresses failed its fund screening checks. The move affected 87 addresses and a total of 117,500 FXRP. Under Firelight’s current mechanism, addresses are screened both when funds are deployed and throughout the full cycle for blacklist status or OFAC sanctions exposure. If an address is flagged at deployment or during the cycle, the funds remain in the protocol until the cycle ends, earn no rewards, but can still participate in the protection module for the rest of that cycle. After the cycle ends, the funds are returned and the related wallets are barred from reconnecting. Firelight said this approach is not sustainable and that it will roll back the blacklist process and unfreeze affected wallets in the coming days, with details on timing and withdrawal steps to be announced separately. The protocol added that its security, KYC and institutional standards will remain unchanged, and that it will seek community input before introducing a new user-friendly solution in the coming weeks. Flare co-founder Hugo Philion said 84 Flare addresses were unstaked under the compliance policy, and that he will personally provide equivalent compensation to those that are not sanctioned and not widely blacklisted.
Firelight, an onchain protection protocol, said some deposit addresses failed its fund screening process, and the related funds have been unstaked and returned to their original addresses. The move involved 87 addresses and a total of 117,500 FXRP.
According to Firelight, its current mechanism screens for blacklisted addresses or addresses sanctioned by the Office of Foreign Assets Control, or OFAC, both at the time funds are deployed and throughout the full cycle. If an address is flagged either at deployment or during the cycle, the funds remain in the protocol until the cycle ends and do not earn rewards. Even so, those funds can still take part in the protection module for the remainder of that cycle.
Once the cycle ends, the funds are returned, and the related wallets are blocked from connecting again.
Firelight said that approach is not sustainable. It plans to roll back the blacklist process and unfreeze the affected wallets in the coming days. The timing and steps for retrieving funds will be announced separately. The protocol also said its security, KYC and institutional standards will stay in place. Over the coming weeks, it plans to develop a new solution that does not affect users and will seek community feedback before any change is made.
Flare co-founder Hugo Philion said 84 Flare addresses were unstaked by Firelight because of its compliance policy. He added that he will personally provide equal compensation to addresses among that group that are not sanctioned and not widely blacklisted.
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