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Tether uses it hundreds of billions of assets to become many things, including social media investors, data center lenders, and one of the largest holders of US T-bills. But this week, Tether became something else: a crypto startup lender of last resort. The stablecoin giant has put up $127.5 million in funding—some in loans, some in grants—to help recover Drift, a Solana-based derivatives exchange that stole $285 million of hackers linked to North Korea earlier this month.
While the funds will not cover the full amount that Drift lost in the hack, the money will provide more stability as the exchange says it will also begin contributing its own revenue in a journey to enable full users.
Tether’s participation in the recovery plan won praise from crypto fans, especially users of the Solana blockchain, where Drift was founded. Meanwhile, that goodwill may come at the expense of Tether’s chief rival, Circle, whose USDC The stablecoin has long been the most popular of Solana and Drift. Tether and Drift did not immediately return requests for comment.
A ‘moral turpitude’
While hacking is not uncommon in the crypto world, the Drift breach is extremely complex. The hackers, thought to be working for the DPRK, approached members of the Drift team at a cryptocurrency conference in late 2025 and pretended to be from a trading company seeking to build the blockchain protocol. Eventually, they won enough trust to gain deeper access to Drift’s systems, opening the door to steal funds, the company said in a statement. statement.
As part of the scheme, the hackers converted their stolen funds, representing several cryptocurrencies, into USDC before distributing the tokens on the Solana blockchain.
After the breach, many Drift customers pointed their fingers at Circle, claiming that the company saw the hack taking place but failed to freeze USDC, which could have prevented the hackers from making the stolen funds.
Circle CEO Jeremy Allaire reports SAYS a private company that freezes user funds at its own discretion creates a “moral quandary,” adding that Circle freezes assets only at the direction of law enforcement or the courts. Reached for comment, Circle sent a blog post from one of its executives on the subject of asset freezes.
Tether, on the other hand, appears to be using the episode to gain goodwill at the expense of its rival. Nicky Scannella, head of Solana marketing group Superteam USA, exchanged $45,000 USDC for Tether’s USDT stablecoin following the news of Tether’s Drift gift.
“The best way to reward (Tether’s) behavior and punish (Circle’s) behavior is to exchange,” Scannella said in a text. “If we want to see more of this…we as users need to take action. It’s like voting.”
USDC and USDT showed a marginal loss and gain, respectively, in the supply of the Solana blockchain the day after Tether’s announcement, per DefiLlama DATA. However, USDC has a nearly $8.1 billion supply of Solana stablecoin to USDT’s $3 billion—though Tether’s coin remains the dominant overall stablecoin with a market cap of $185 billion compared to Circle’s $78 billion.
Tether also gained a new client through the ordeal. Drift will use USDT, instead of USDC, for settlement if the exchange changes, the company said in a statement.
