Following a significant exploit that resulted in the loss of over $270 million in client assets, Drift Protocol has announced plans to relaunch using Tether's USDT as its settlement layer, thanks to a proposed funding package of up to $147.5 million from Tether and its partners. The deal comprises $127.5 million from Tether and $20 million from other partners, and is structured to facilitate user recovery and reboot the platform as a USDT-based perpetual futures exchange on Solana, replacing Circle's USDC as its settlement layer.
The rescue package includes 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. This development comes after a North Korea-linked group infiltrated Drift Protocol, posing as a quantitative trading firm for about six months before executing an exploit on April 1. Drift's governance token, DRIFT, has lost around 70% of its value since the exploit.
The funding also marks a significant shift in the stablecoin landscape, with Tether's USDT set to play a central role in Drift's trading infrastructure, providing a pathway to restore user funds and resume operations.