Drift’s $148M Recovery Plan Backed by Tether Signals Major Shift Away From USDC

Drift Protocol has secured a funding package of up to $147.5 million from Tether and partner investors to recover user losses following a major security breach. The deal includes up to $127.5 million from Tether and an additional $20 million from ecosystem partners, aimed at restoring funds and relaunching the platform.

The protocol was hit by a North Korea-linked exploit on April 1, resulting in losses exceeding $270 million in user assets. Under the recovery plan, Drift will transition its settlement layer from USD Coin (USDC) issued by Circle to Tether (USDT), rebuilding its system as a USDT-based perpetual futures exchange on Solana.

Revenue-Linked Recovery Plan Targets User Compensation

The funding structure includes a combination of loans, ecosystem grants, and market maker incentives. A portion of future trading revenue will be directed into a recovery pool designed to repay approximately $295 million in affected user funds over time.

Drift, one of the largest decentralized perpetual exchanges on Solana, previously supported more than 175,000 users and processed roughly $150 billion in cumulative trading volume.

Stablecoin Competition Intensifies After Exploit Fallout

The incident has intensified competition between USDT and USDC, with Tether positioning itself as a more flexible settlement layer due to its ability to freeze funds linked to illicit activity. The shift highlights growing tension in the stablecoin sector as platforms increasingly choose infrastructure based on liquidity control, security response speed, and regulatory alignment.

Disclaimer

This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.