Drift Protocol, recently victimized by a North Korean exploit, is set to relaunch with USDT as its settlement layer after receiving a funding package of up to $147.5 million from Tether and its partners. The funding, which includes $127.5 million from Tether and $20 million from other partners, is structured to support the recovery of user funds and reboot the platform as a USDT-based perpetual futures exchange on Solana, replacing Circle's USDC as its settlement layer.
The package combines 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. This development comes after a North Korea-linked group infiltrated Drift Protocol, resulting in an exploit of over $270 million on April 1, causing Drift's governance token, DRIFT, to lose about 70% of its value. The incident drew criticism towards Circle for not halting the money transfer, with the attacker moving around $232 million in USDC from Solana to Ethereum using Circle's cross-chain transfer protocol.
In contrast, USDT has been more proactive in freezing funds linked to hacks or illicit activities. As the largest decentralized perpetual futures exchange on Solana, with over 175,000 users and $150 billion in cumulative trading volume, Drift's transition to USDT is expected to position USDT at the center of its trading infrastructure, providing a pathway to restore user funds and resume operations.