Drift Foundation opens DFX redemptions after $290 million Solana exploit

DFX token mechanism and recovery rate

DFX tokens were distributed to wallets that verifiably lost funds in the exploit. The exchange established that each USDT lost entitles a wallet to one DFX token. At launch, the redemption rate for DFX stood at approximately 0.0104 USDT per token, offering holders about one cent per dollar lost. The rate is directly tied to the balance of the protocol’s Recovery Pool, which launched with $3.1 million in USDT, and fluctuates as additional funds are added.

Supply is capped at roughly 299.5 million DFX. The foundation stated that the Recovery Pool’s balance would rise in response to new money flows, increasing the eventual recovery rate for token holders.

Funding the Recovery Pool

The main funding stream for the Recovery Pool is protocol revenue from Velocity, which sends a share of its net revenue to the pool daily at midnight UTC. The proportion of net revenue increases as daily proceeds grow, starting at 60% for up to 30,000 USDT, rising to 70% for the following 70,000 USDT, and up to 90% above 100,000 USDT each day. Deposits will continue until the pool reaches the total verified amount of user losses.

Additional support has been pledged, including up to 127.5 million USDT from stablecoin issuer Tether and up to 20 million USDT from strategic partners, boosting the resources dedicated to affected users. Roughly $9.2 million in stolen assets has also been frozen and will eventually contribute to the pool as recoveries progress.

As of Friday morning, Drift’s recovery dashboard indicated that most of the current pool balance stemmed from a single deposit of the protocol’s remaining assets.

Mandiant, a prominent cybersecurity firm, attributed the attack to a group based in North Korea, according to the investigation commissioned by the foundation.

Mini dictionary: Mandiant, a cybersecurity firm known for advanced threat intelligence and digital forensics services.

Claim and redemption process

To participate, users must initiate claims using the same Solana wallet that was connected to their Drift account during the exploit event. Once claimed, DFX tokens can be redeemed from any wallet, traded on protocols such as Raydium, or held for future redemptions. Redeeming DFX immediately burns the tokens and sends USDT to the user in a single transaction.

Future deposits to the Recovery Pool directly benefit unclaimed tokens. For example, if 10% of the DFX supply is redeemed, remaining holders proportionally receive about 11% more from subsequent revenues.

Claims are open until midnight UTC on January 1, 2028. After this date, any unredeemed DFX will be burned, closing out the recovery initiative for affected users.