Following a recent 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 settlement layer, backed by a $147.5 million funding package 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. The funding comes after a North Korea-linked group infiltrated Drift Protocol, posing as a quantitative trading firm, and carried out an exploit on April 1.
Drift's governance token, DRIFT, has since lost approximately 70% of its value. The incident also sparked criticism towards Circle, the issuer of USDC, for not freezing funds linked to the exploit in a timely manner. In response, Circle's CEO, Jeremy Allaire, stated that the company only freezes USDC wallets when directed by law enforcement or courts. In contrast, Tether has a history of freezing assets linked to hacks or illicit activities.
With the new funding, Tether plans to support fee reductions, user incentives, and liquidity provision to designated market makers, solidifying USDT's position at the center of Drift's trading infrastructure. The move is expected to restore user funds and resume operations, while also intensifying competition in the stablecoin market between USDT and USDC.