Drift Protocol Receives $150M in Recovery Fund from Tether and Partners As USDC Drops for USDT

Tether will inject up to $127.5 million into the Drift Protocol as part of a recovery plan totaling approximately $150 million. million Following an exploit of its platform that resulted in user losses of nearly $285 million, the company announced Thursday.

Tether CEO Paolo Arduino hinted at the bailout earlier today.

Today will be a good day for DeFi.

— Paolo Ardoino 🤖 (@paoloardoino) April 16, 2026

In a separate statement, Arduino explained that Tether's role in the digital asset ecosystem is to support the industry in times of distress, moving forward in “dark times.” The move is aimed at restoring consumer confidence through a reset linked to real activity and long-term growth.

“This collaboration reflects our confidence in Drift and its role in the DeFi ecosystem,” Arduino said. “The focus is on restoring consumer confidence and supporting a strong restart with a framework that aligns recovery with real activity and long-term growth.”

The structure links payments to ongoing transaction activity, with platform revenues contributing to user recovery as operations continue. Additional funding is gradually deployed and linked to performance, aligning recovery with usage rather than upfront capital injections.

Drift plans to shift its settlement assets from USDC to USDT, to the dismay of over 128,000 users and ecosystem participants. The move is expected to increase liquidity and strengthen USDT's role in the Solana-based trading infrastructure.

Drift's home token, DRIFT, rose by about 22% following the announcement, from $0.045 to $0.055 on CoinGecko. The token has previously dropped up to 30% after the attack.

After the exploitation of the drift, the circle will be tested on the frozen period of USDC

Circ has come under fire following the Drift Protocol exploit in which attackers transferred over $230 million USDC to Ethereum. Critics, including prominent blockchain sleuth ZachXBT, said the crypto giant had the technical ability to block funds for a multi-hour transfer window but took no action.

Circle CEO Jeremy Allaire defended the company's USDC ban policy. Responding to criticism, Allaire said, wallet bans are only done under formal legal authority such as court orders or law enforcement directives.

Circle insists that it only operates under legal obligations and clear regulatory standards for stablecoin issuers.