Firebolt nade problem isn't the damage but rather the time it primes you for death.
Whereas a regular damage dealing nade will injure you you can spec to try and counter this sort of thing with high recovery stats, making your primed for death state only a few seconds.
While firebolt nades with Viking funeral/burning touch takes you out of the fight for upwards of 10 seconds which regardless of how good you are, if you receive even a stiff fart worth of damage you're going down.
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Agreed. Damage can be kept the same, the burn should be done faster and don't allow the grenade user to see the damage ticks at all (optional)