Drift Secures $148 Million in Funding from Tether and Partners to Recover from Exploit

Following a significant exploit that resulted in the loss of over $270 million in client assets, Drift Protocol has announced a proposed funding package of up to $147.5 million from Tether and its partners. This package, which includes up to $127.5 million from Tether and $20 million from other partners, aims to support user recovery and reboot the platform as a USDT-based perpetual futures exchange on Solana. The deal comprises a revenue-linked credit facility, ecosystem grants, and loans to market makers, with a portion of trading revenue and committed capital directed towards a recovery pool to cover approximately $295 million in user losses over time. Drift's decision to switch from Circle's USDC to Tether's USDT as its settlement layer comes after a North Korea-linked group infiltrated the platform, resulting in a substantial loss of funds. The incident led to criticism of Circle for not halting the money transfer promptly, whereas Tether has a history of freezing assets linked to hacks. With this funding, Tether plans to support fee reductions, user incentives, and liquidity support for Drift's transition to USDT, solidifying USDT's position at the center of Drift's trading infrastructure and paving the way for the restoration of user funds and the resumption of operations.