Following a significant exploit linked to North Korea, Drift Protocol is set to relaunch using Tether's USDT as its settlement layer after securing a funding package of up to $147.5 million from Tether and its partners. The package, which includes up to $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 funding package combines 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. Drift's governance token, DRIFT, has seen a substantial decline of about 70% in value since the exploit.
The incident led to criticism of Circle for not halting the transfer of funds quickly enough, with the attacker moving around $232 million in USDC from Solana to Ethereum using Circle's cross-chain transfer protocol. In contrast, Tether has demonstrated a more agile approach to freezing funds linked to hacks or illicit activities. As the largest decentralized perpetual futures exchange on Solana, with over 175,000 users and around $150 billion in cumulative trading volume, Drift's transition to USDT is expected to position USDT at the heart of its trading infrastructure, providing a pathway to restore user funds and resume operations.