Following a significant exploit that resulted in the loss of over $270 million in user assets, Drift Protocol has announced a funding package of up to $147.5 million from Tether and other 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 trading revenue will be directed towards a recovery pool to cover roughly $295 million in user losses over time.
The funding comes after a North Korea-linked group infiltrated Drift Protocol, resulting in a significant exploit on April 1. The platform's governance token, DRIFT, has lost approximately 70% of its value since the exploit. The 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 response to the exploit, Drift will be transitioning to USDT as its settlement layer, with Tether planning to provide fee reductions and user incentives to support the platform's relaunch. The move is expected to position USDT at the center of Drift's trading infrastructure while providing a pathway to restore user funds and resume operations.