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

Following a significant exploit that resulted in the loss of over $270 million in client assets, Drift Protocol has announced plans to relaunch with Tether's USDT as its new settlement layer, thanks to a proposed funding package of up to $147.5 million from Tether and its partners. The package, which includes a revenue-linked credit facility, ecosystem grants, and loans to market makers, aims to support user recovery and reboot the platform as a USDT-based perpetual futures exchange on Solana. Previously, the platform utilized Circle's USDC as its settlement layer. A portion of the trading revenue, alongside committed capital, will be directed towards a recovery pool to cover roughly $295 million in user losses over time. The exploit, which was linked to a North Korean group, occurred on April 1 and resulted in the loss of over $270 million. Drift's governance token, DRIFT, has since lost approximately 70% of its value. The recent incident has sparked controversy surrounding Circle's handling of the situation, with some critics arguing that the company could have acted faster to freeze funds and prevent the attacker from transferring assets. In contrast, Tether has a history of freezing assets linked to hacks or illicit activities. As the largest decentralized perpetual futures exchange on Solana, Drift boasts over 175,000 users and approximately $150 billion in cumulative trading volume. The platform's transition to USDT is expected to position the stablecoin at the center of its trading infrastructure, providing a pathway to restore user funds and resume operations. The move is also seen as a strategic play in the intensifying competition among stablecoin issuers, with Tether and Circle vying for dominance in the market.