Drift Protocol (DRIFT): the $295M Solana hack, the DFX recovery token and the relaunch as Velocity

Drift Protocol, for four years one of the busiest perpetual futures exchanges on Solana, no longer trades under its own name. On 1 April 2026 attackers took over its admin powers and drained between about $285 million and $295 million, depending on who counts. Drift Labs rebuilt the exchange from its v2 code and renamed it Velocity, with effect from 1 July 2026.

People who lost money now hold a recovery token called DFX. When claims opened on 1 October 2026, one DFX redeemed for about 0.0104 USDT: roughly one cent per dollar lost. Tether and partners have promised far larger sums, but none of that money had reached the pool by early October.

The stolen money is moving again. On 20 October a wallet that Etherscan labels “Drift Exploiter 5” pushed 25,710 ETH into Tornado Cash in a little over two hours, as we reported in our news piece on the Drift exploiter’s Tornado Cash deposits. Two outlets reported a second batch the next day. On the evening of 21 October one labelled wallet still held 56,568 ETH, according to Etherscan’s “Drift Exploit” label page.

The Drift-branded website has not caught up. On 21 October the home page at drift.trade still showed trading buttons and old statistics, with no word on Velocity or the April attack. The legacy protocol, listed as Drift Trade on DefiLlama, held about $642,000 that day.

Drift Protocol today: renamed Velocity, repaying cents on the dollar

Three things still carry the Drift name in October 2026: DFX, the DRIFT governance token with its foundation site at drift.foundation and voting forum, and the old website. None of them is a live Drift market.

The trading business is Velocity, at velocity.exchange. Its documentation calls it a perpetual futures exchange and a money market “deployed as a single Solana program”, forked from the Drift Protocol v2 codebase. Drift’s recovery plan of 5 May promised a new program “at a fresh address with fully rotated keys”, so this is a new deployment, not the old contracts with a new logo. Drift had launched a v3 in December 2025; how much of it carries into Velocity is not documented.

On 21 October Velocity’s site listed BTC, ETH and SOL perpetuals with leverage up to 20x and HYPE up to 10x, settled in USDT, the stablecoin described on our Tether (USDT) page. A market for stock perpetuals was marked “Coming Soon”, while the site’s FAQ said NVDA and TSLA would trade at launch. Accepted collateral was wBTC, wETH, SOL and USDT.

The fee figures do not agree with each other. The site’s FAQ says taker fees on BTC, ETH and SOL start at 0.060% and fall to 0.02% with 30-day volume, with a 0.0025% maker rebate and 5% off for referred users. The documentation gives a base tier of 0.04%, and a review by decentralised.news on 17 July quoted 0.035% to 0.020%.

Activity is small. DefiLlama began tracking Velocity on 29 September and records open interest of $95,346 on 21 October, after staying below $120,000 for the previous two weeks. In December 2025 Drift claimed $650 million of open interest.

What Drift was and how it worked

Drift launched on Solana in late 2021; DefiLlama lists it from 3 December 2021. It offered perpetual futures, contracts that track an asset’s price with no expiry date, run by on-chain programs rather than a company’s matching engine.

Its distinctive feature was the single account. A trader deposited several assets, lent or borrowed them through a built-in money market and traded perpetuals against the combined value, a set-up known as cross-margin. When losses ate through the collateral, keepers closed positions, as our glossary entry on liquidation explains. An insurance fund filled by stakers stood behind bad debt.

Over 2024 and 2025 Drift added vaults run by strategy managers, isolated pools for riskier assets, an order-routing system called Swift, a leveraged product called Amplify and Builder Codes for outside front ends. Its largest vault strategy was built on JLP, the liquidity token of Jupiter, the Solana trading venue.

Drift v3 opened on an invite-only basis on 4 December 2025. Drift said 85% of market orders filled within the same Solana slot, about 400 milliseconds, and that price impact on large market orders fell from 20 basis points to 2. The same post claimed more than $1.5 billion of TVL, over $133 billion of cumulative volume and $650 million of open interest: Drift’s own figures, not independent ones.

From $1.1 billion locked to under $1 million

DefiLlama’s data for Drift Trade, read on 21 October 2026 at 18:18 UTC, shows the rise and the collapse. The values are midnight UTC points except the last.

Date	Total value locked (DefiLlama)
1 May 2024	$283.4 million
1 January 2025	$806.3 million
10 October 2025 (peak)	$1,112.7 million
1 December 2025	$647.0 million
1 April 2026	$311.4 million
2 April 2026	$23.5 million
1 June 2026	$6.3 million
21 October 2026, 16:32 UTC	$0.64 million

Fees fell the same way. DefiLlama counts about $25.2 million of fees in calendar 2025, peaking at $4.23 million in October. In 2026 the monthly figure went from $1.31 million in January to $0.66 million in March, about $13,500 in April and zero from May. All-time fees stand at $41.1 million.

Volume is harder to pin down. DefiLlama’s volume series sits behind a paid plan, and Drift’s own totals grew from “$120B+” in November 2025 to “more than $150 billion” in Cindy Leow’s account of 29 September 2026. Those are the company’s numbers.

How did Drift get hacked? The 1 April 2026 takeover

No bug in Drift’s smart contracts was needed. “Nobody broke Drift’s code,” Rekt wrote: the attackers obtained the admin powers instead. The sequence below follows Chainalysis’s account of 9 April, which rests on Drift’s own investigation and which Chainalysis says had not been independently verified. Elliptic and Rekt agree on the main points.

Six months of social engineering

For about six months, people posing as a quantitative trading firm built relationships with Drift contributors at conferences, over Telegram and in working sessions. They onboarded a vault on Drift and deposited more than $1 million to look like a real client.

On 10 and 11 March 2026 they withdrew funds from Tornado Cash to pay for the operation. On 12 March they created a token called CarbonVote (CVT), kept about 80% of the supply and traded it back and forth near $1 in a pool holding about $500. An oracle they controlled then reported that price, so CVT looked like an asset with a market.

Durable nonces and a 2-of-5 council with no timelock

From 23 March the attackers set up durable nonce accounts, some tied to members of Drift’s Security Council. On Solana a durable nonce lets a transaction be signed now and sent days later instead of expiring within a minute or two. At least two council members signed transactions they did not fully understand.

On 26 March Drift moved its admin rights to a new Security Council multisig that needed two signatures out of five and had no timelock, so an approved change took effect at once. The attackers obtained signatures on the new multisig too. Rekt’s verdict: the weakest link was “two signatures and no timelock”.

Fake collateral, real withdrawals

At 16:05:18 UTC on 1 April the first pre-signed transaction proposed handing the admin key to an attacker address; one second later the second executed it. With admin rights the attacker listed CVT as collateral, lifted borrowing and withdrawal limits, deposited 500 million CVT “worth” about $500 million and withdrew real assets against it.

Elliptic names the JLP Delta Neutral, SOL Super Staking and BTC Super Staking vaults as the main targets. Chainalysis counts at least 18 token types and puts the last confirmed drain at 18:31 UTC; Drift’s pause snapshot is stamped 18:31:47 UTC. At least 20 other Solana protocols reported disruption, pauses or losses.

The money left Solana within minutes. Stolen tokens were swapped and bridged to Ethereum, mostly as USDC through Circle’s Cross-Chain Transfer Protocol, with SOL going through Chainflip, and then converted into ETH. Chainalysis says the first funds arrived on Ethereum about 23 minutes after the takeover. Circle later froze about 3.36 million USDC from three transfers, but Rekt faulted it for letting more than $230 million cross over six hours.

North Korea attribution: what Drift and Mandiant say

On 5 April Drift, backed by the SEAL 911 security group, said with medium-high confidence that the attackers were the same actors as in the October 2024 Radiant Capital hack, which Mandiant had attributed to UNC4736. On 3 June Drift wrote that Mandiant’s independent forensic analysis attributed the attack to UNC6862, which Drift described as a North Korean threat group.

That is an attribution by forensic firms, not a court finding. No charges, arrests or seizures linked to the case had been reported by 21 October.

How much was lost: $285 million to $295 million

There is no single figure. The gap comes from pricing times and from what each counter includes.

Source and date	Loss estimate
Elliptic, updated 7 April 2026	about $286 million
Chainalysis, 9 April 2026	about $285 million
Drift recovery update, 16 April 2026 (19 assets)	$295,706,374.93
Drift recovery plan, 5 May 2026	$295,426,725.97
DefiLlama hacks list, read 21 October 2026	$295 million

Drift’s 16 April breakdown shows where the losses sat: JLP $159.3 million, USDC $71.4 million, cbBTC $11.3 million and SOL $10.4 million. DefiLlama files the case under access control, technique “Proxy Upgrade Hijack”. According to Cointelegraph on 20 October, DefiLlama ranks it the third-largest hack of 2026.

Drift recovery plan: DFX, Tether and one cent per dollar

On 16 April Drift announced support from Tether of up to $127.5 million, plus $20 million from other partners. The package covered a $100 million revenue-linked credit facility, an ecosystem grant and loans to market makers, and the relaunched exchange would settle in USDT instead of USDC.

Drift’s recovery plan of 5 May set the rules: one recovery token per dollar of verified loss, balances priced at 16:06:00 UTC on 1 April, just before the attack, and spot holdings converted to USDT. It listed about $3.8 million of assets left in the protocol and a 10% bounty on recovered funds, run with Bybit and others, with ZeroShadow and Mandiant on the forensics.

How the DFX recovery token works

Drift’s DFX post of 1 October describes a standard Solana token with a fixed supply of 299,500,810.998, one per verified USDT lost. Redeeming burns DFX and pays USDT in a single, final transaction. The amount per token is the pool balance divided by the DFX outstanding. A deposit raises it; a redemption leaves it unchanged, but every burned token means later deposits are shared among fewer holders.

The pool is topped up daily at 00:00 UTC. Velocity sends 15% of net trading fees to the Insurance Fund and 15% to its AMM capital; of the remaining 70%, the pool takes 60% of the first 30,000 USDT a day, 70% between 30,000 and 100,000 USDT and 90% above that. Tether’s up to 127.5 million USDT, the partners’ 20 million and any recovered funds go into the same pool.

Claims close at 00:00 UTC on 1 January 2028, and unclaimed DFX is then burned. DFX can be sold on Raydium instead of redeemed. It is separate from DRIFT and, under the May plan, not accepted as collateral.

Pledges are not payouts

At launch the pool held about 3.1 million USDT, which is why one DFX redeemed for roughly 0.0104 USDT: a 1,000 USDT loss came back as about 10.40 USDT. The Block reported on 2 October that 216,480 DFX had been redeemed for about 2,250 USDT, that Velocity’s revenue had added 31 USDT after the first day, and that no Tether or partner money showed on the dashboard.

Under the 5 May plan, Tether’s money is deployed according to the exchange’s revenue in the previous quarter. It is a commitment that depends on Velocity doing business, not cash already in the pool. How much DFX has been claimed since, and what one token redeems for today, could not be read from the dashboard on 21 October.

Frozen funds and the DIP-10 vote

According to The Block, the Foundation’s update of 30 September put frozen funds at about $9.2 million, to be added to the pool once law enforcement releases them. Which assets they are and who froze them has not been published. Two Wormhole transfers, 59.37 WBTC and 557.90 WETH, were held back until late July, and what became of them is not public.

The pool’s first money came from depositors themselves. DIP-10, posted on the governance forum on 12 May, proposed converting all remaining assets in the borrow and lend pool into stablecoins to form the recovery reserve. Users with untouched balances objected on the forum that their leftover deposits were being pooled with everyone’s losses. The final vote result does not appear in the sources we read; a first pool of about 3.1 million USDT is consistent with the conversion going ahead.

Drift hack update: the Tornado Cash deposits of July and October

In early May the attacker held about 130,259 ETH across four Ethereum wallets, according to Drift. On 23 and 24 July the wallet labelled Exploiter 4 sent 23,095.1 ETH, about $44.4 million at the time, to Tornado Cash and 0.85 ETH to Bybit deposit addresses, as PeckShield flagged. The Block reported on 2 October that three attacker wallets still held 107,165 ETH.

In the October round, Cryptoslate counted 258 deposits from Exploiter 5 between 07:08 and 09:21 UTC on 20 October, totalling 25,710 ETH. On 21 October, FinanceFeeds, citing the tracker Onchain Lens, and Crypto Briefing reported another 18,800 ETH, about $46 million, bringing the two days to 44,510 ETH, about $109 million. Coindaro has not checked the second day against a transaction list. Adding July, FinanceFeeds puts the reported total routed through the mixer at about 67,605 ETH. No statement from Drift, Velocity or the Foundation on the October moves had appeared by the evening of 21 October.

A Tornado Cash deposit hides where funds go next; it does not prove a sale. FinanceFeeds notes that the transfers do not show the ETH has been sold or put beyond investigators’ reach, and Cryptoslate calls the amount that will return to the DFX pool unresolved.

In the United States the mixer is off the sanctions list again: OFAC removed Tornado Cash and its Ethereum addresses on 21 March 2025, while co-founder Roman Semenov stays designated. Another co-founder, Roman Storm, was convicted in August 2025 of conspiring to run an unlicensed money transmitting business; the jury split on the laundering and sanctions counts, and Decrypt reports a retrial set for 26 April 2027.

Velocity: what changed in the rebuilt exchange

Drift tied its relaunch to two outside reviews, OtterSec for the code and Asymmetric Research for operational security. On 17 September 2026 Velocity published the OtterSec report and put its source code on GitHub. According to Velocity’s documentation, the audit ran from 19 June to 20 July 2026 and found 154 issues: none critical, 41 high, 109 medium, one low and three informational. Velocity says every high finding is fixed in the deployed code. The Solana Foundation’s STRIDE review was still under way.

The admin design is the main change. Power is split into tiers, each with its own multisig: a cold admin for program upgrades, with outside security firms among the signers, a warm admin for parameters, a pause admin that can only add pauses, and hot wallets for bots. Signers use dedicated devices, critical multisigs are time-locked, every proposal and approval raises an alert, and guardrails in the program limit sensitive admin actions. Drift’s April update added that durable nonces would be disabled for all signers.

Velocity also dropped spot trading; swaps remain, and spot markets still serve for collateral and lending. The Insurance Fund is described as owned entirely by its stakers. In Velocity’s 17 September post, Head of Protocol Noah Prince said “every change that reaches users will be audited by an outside firm before reaching mainnet.”

One loose end: on 21 October the docs home page still said the program was “not open source yet”, while the code sat on GitHub under velocity-exchange.

A new team in charge

The same post said the beta would open to everyone “in the coming days”; Cryptoticker reports the whitelist came off on 21 September. On 29 September Cindy Leow said on X that she was stepping back. According to Solana Compass, co-founder David Lu keeps the asset recovery and law enforcement work with the Foundation, while Noah Prince, formerly head of protocol engineering at Helium and with Drift since June, runs the protocol. Product, partnerships and growth leads are named by X handle only.

The DRIFT token after the rebrand

DRIFT is a Solana token with a maximum supply of 1 billion, launched with an airdrop whose claims opened on 16 May 2024. Drift’s tokenomics update of 18 November 2025 put circulating supply at 555,713,264 (55.6%), with a circulating cap of 750 million and a five-year emission schedule.

That update split the supply into ecosystem and trading (43%), the launch airdrop (10%), protocol development (25%, half unlocked at the time) and strategic participants (22%). Team allocations carried an 18-month lock followed by 18 months of vesting. Whether any of this changed after the exploit has not been published.

What DRIFT does now is unclear. Velocity’s site and documentation did not mention it on 21 October, and decentralised.news reported in July that the fork dropped the token-staking fee discounts. Governance still runs through drift.foundation and its forum, and on 16 April Drift listed about 8.74 million DRIFT among the protocol’s remaining assets. The live price is shown on this page, not in the text.

Funding and audits

Drift says it raised $52.5 million. DefiLlama lists a $3.8 million seed round on 26 October 2021 with Alameda Research, Jump Capital, Multicoin Capital, Not3Lau Capital and QCP Capital; Drift’s own pages do not name them. Polychain Capital led a $23.5 million Series A on 22 May 2023, joined by Solana co-founders Anatoly Yakovenko and Raj Gokal, Ethereal Ventures and Folius Ventures. Multicoin Capital led a $25 million Series B on 19 September 2024 with Blockchain Capital, Primitive Ventures and Folius. Tether’s April package is a recovery arrangement, not an equity round.

Trail of Bits reviewed Drift v2 from 7 November to 2 December 2022 and reported no high-severity flaws; Neodyme’s report on the same code is dated 10 May 2024. Both covered code only, not the admin set-up that failed in April 2026. The OtterSec report of September 2026 is the first on Velocity’s post-fork code.

Drift Protocol history, 2021 to 2026

• 2021: Drift is founded; seed round on 26 October; mainnet on Solana late in the year.
• 11 May 2022: during the LUNA crash, DefiLlama records a $14.5 million “risk parameter abuse” incident on Drift v1, with the funds listed as returned.
• 19 December 2022: Drift v2 opens on mainnet to all users.
• 22 May 2023: $23.5 million Series A led by Polychain Capital.
• 16 May 2024: DRIFT launches with an airdrop.
• 19 September 2024: $25 million Series B led by Multicoin Capital.
• 10 October 2025: total value locked peaks at $1.11 billion on DefiLlama.
• 4 December 2025: Drift v3 launches, invite-only.
• 1 April 2026: admin takeover and drain of about $285 million to $295 million.
• 16 April 2026: Tether and partners announce up to $147.5 million in support.
• 1 July 2026: the exchange is renamed Velocity.
• 23 and 24 July 2026: first Tornado Cash deposits from an exploiter wallet.
• 17 September 2026: OtterSec report and source code published.
• 29 September 2026: Cindy Leow steps back.
• 1 October 2026: DFX claims and redemptions open.
• 20 and 21 October 2026: second round of Tornado Cash deposits.

Drift Protocol risks: why Coindaro rates it 5 out of 5

Coindaro rates the project 5 out of 5 for risk. Users lost about $285 million to $295 million and had recovered around one cent per dollar when redemptions opened. The cause was operational: a 2-of-5 multisig, no timelock and signers tricked into pre-signing. Velocity’s tiered keys and timelocks target that, but no audit can prove that people will not be fooled again.

The code is a fork of Drift v2 whose new parts have been audited once, and the STRIDE review was still running on 21 October. With open interest near $95,000, large orders can move prices more than on a busy venue. A new team runs the exchange, most of the recovery money depends on Tether and on Velocity’s future revenue, and the attacker still controls tens of thousands of ETH.

Traders looking at a larger on-chain perpetuals venue can compare Hyperliquid, which runs its own chain; Coindaro gives no view on which to use.

What to watch next

The first test is whether Tether or partner money shows up in the DFX pool, since Velocity’s current revenue barely moves the redemption amount. The second is the remaining ETH: Etherscan showed 56,568 ETH on Exploiter 3 on 21 October. Then come the end of the STRIDE review, the stock perpetuals marked “Coming Soon”, and the order book and Prop AMM that Solana Compass says the new team is working on. Roman Storm’s retrial is set for 26 April 2027, and the DFX claim window closes on 1 January 2028.