Following a significant exploit that resulted in the loss of over $270 million in client assets, Drift Protocol has announced plans to relaunch its platform using 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 funding package, which includes $127.5 million from Tether and $20 million from other partners, is designed 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 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 aimed at covering approximately $295 million in user losses over time. The exploit, which occurred on April 1, was carried out by a North Korea-linked group that had infiltrated Drift Protocol by posing as a quantitative trading firm for about six months. The incident led to widespread criticism of Circle, the issuer of USDC, for its perceived slow response in halting the transfer of exploited funds.
In contrast, Tether has demonstrated its ability to freeze assets linked to hacks or illicit activities promptly. 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 the stablecoin at the center of its trading infrastructure, while providing a pathway to restore user funds and resume operations.