# Kraken and Firelight DeFi protection integration > Live situation record from CLSTR: https://clstr.news/situations/kraken-and-firelight-defi-protection-integration > Updated: 2026-10-17T12:34:56.000Z. Sources: 4. Developments: 2. Firelight has implemented approximately $31 million in onchain coverage for the Kraken Protected Strategies USDC vault. Curated by Sentora and operating on the Flare Network, the coverage utilizes a shared pool of staked FXRP to provide a backstop against specific decentralized finance (DeFi) failures, including smart contract exploits, oracle failures, and governance attacks. Coverage explicitly excludes losses from market movements or asset price fluctuations. Payouts are capped at $100,000 per depositor address during each 30-day epoch, with claim validation managed by a consortium of five independent firms. For Kraken users, the protection is integrated into the DeFi Earn service. The cost of the coverage is deducted directly from the vault’s yield, meaning the published annual percentage yield already accounts for these fees. While XRP holders can earn fees by providing collateral to the Firelight pool, they assume the financial risk of qualifying losses. Kraken has clarified that it does not guarantee these payouts or receive the coverage fees. ## Timeline ### 2026-10-17: Kraken integrates XRP-backed DeFi protection via Firelight Kraken's Protected Strategies USDC vault now features DeFi loss protection via Firelight on the Flare Network, utilizing XRP-linked collateral to cover eligible exploits. 2 sources. https://clstr.news/cluster/kraken-integrates-xrp-backed-defi-protection-via-firelight ### 2026-10-15: Firelight adds $31M in onchain coverage to Kraken USDC vault Firelight has added $31 million in onchain coverage to Kraken’s Protected Strategies USDC vault to protect against DeFi failures like smart contract exploits and oracle errors. 3 sources. https://clstr.news/cluster/firelight-adds-31m-in-coverage-to-kraken-usdc-vault --- Cite as: Kraken and Firelight DeFi protection integration. CLSTR, https://clstr.news/situations/kraken-and-firelight-defi-protection-integration