I recently installed an update to a piece of software that puts all browsing through a proxy running on 127.0.0.1 (port 8777) (there IS good reason for this and it's more effective than how the previous version of the software worked). Since I'm not an expert in such matters I'm slightly concerned that this could also be open and internet facing - opening my computer to security threats from anyone who knows/guesses my IP address. Is this case?

Will keeping it blocked on Windows Firewall eliminate any potential risk (so far as I can tell it still functions as intended when blocked)?