Following a recent 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 package, which includes up to $127.5 million from Tether and $20 million from other partners, is designed to support user recovery and reboot the platform as a USDT-based perpetual futures exchange on Solana. Previously, the platform utilized Circle's USDC as its settlement layer.
The rescue 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 aimed at covering roughly $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 carrying out the exploit on April 1.
The incident led to a significant loss of value for Drift's governance token, DRIFT, which has declined by approximately 70% since the exploit. The funding package also includes plans for fee reductions and user incentives tied to Drift's transition to USDT, as well as liquidity support for designated market makers to enhance trading depth at relaunch. This move is expected to position USDT at the center of Drift's trading infrastructure, providing a pathway to restore user funds and resume operations.