Firelight Will Roll Back Blacklist Process for 87 Flare Wallets

Firelight will roll back its blacklist process and reopen access for affected wallets after 117,500 FXRP was returned across 87 addresses, changing how the protocol handles compliance screening.

The funds were unstaked and sent back to their original addresses after the wallets failed Firelight’s screening process. The affected addresses will be able to reconnect once the rollback is completed, with the timing and recovery steps to be announced.

Firelight currently screens funds when they are deployed and throughout their coverage period. If an address is flagged at either stage, the funds remain in the protocol until the period ends, earn no rewards and continue participating in the coverage module for the remaining period. The funds are then returned, while the wallet is blocked from reconnecting.

The arrangement is not sustainable, and Firelight will reverse it in the coming days. Its security, know-your-customer and institutional standards will remain unchanged as it develops a replacement approach over the next several weeks.

The new approach will be presented for community feedback before any changes are made. The process is intended to avoid disrupting users while preserving Firelight’s screening requirements.

Flare co-founder Hugo Philion said 84 Flare addresses were affected by Firelight’s compliance policy. He said he would personally provide equal compensation to addresses that are not sanctioned and have not been broadly blacklisted.

FXRP is Flare’s representation of XRP and is used in external decentralized-finance markets, including lending markets. Firelight’s withdrawal model ties withdrawals to coverage periods rather than an instant-redemption process.

Firelight is expected to announce when affected users can recover their funds and reconnect their wallets.