Drift Secures $148 Million in Funding to Recover from Recent Exploit and Transition to USDT

Drift Protocol, a victim of a recent North Korean cyber attack, has announced plans to relaunch with Tether's USDT as its primary settlement layer after securing a substantial funding package of up to $147.5 million from Tether and its partners. The deal, which includes $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, replacing its previous use of Circle's USDC. The funding package comprises a revenue-linked credit facility, ecosystem grants, and loans to market makers, with a portion of trading revenue and committed capital allocated to a recovery pool to cover approximately $295 million in user losses over time. The exploit, which occurred on April 1, resulted in losses exceeding $270 million, prompting criticism of Circle for not halting the transfer of funds. In contrast, Tether has demonstrated its ability to freeze assets linked to hacks and illicit activities. As the largest decentralized perpetual futures exchange on Solana, Drift boasts over 175,000 users and a cumulative trading volume of roughly $150 billion. The move to USDT positions Tether at the center of Drift's trading infrastructure, enabling the protocol to restore user funds and resume operations. The development also reflects the intensifying competition in the stablecoin market, with USDT and USDC vying for dominance. With this new funding, Tether plans to support fee reductions, user incentives, and liquidity support for Drift's transition to USDT, bolstering its position in the market.