Velocity opens Drift exploit claims with initial payouts just over 1% of losses

Decentralized exchange Velocity, formerly Drift, has opened claims for users who lost funds in its April exploit, with initial payouts just over 1% of losses. Velocity said on Thursday that users can claim one DFX token for every USDT lost. DFX holders can redeem and burn DFX for USDT from Drift's recovery pool. DFX holders can alternatively sell DFX on the secondary market or hold DFX while awaiting more recovery funding. Holding DFX could theoretically bring users closer to full reimbursement because new deposits are divided among fewer DFX as tokens are burned. Each DFX currently can be redeemed for a little over 0.01 USDT, roughly one cent for every dollar lost. Velocity's redemption and recovery dashboard showed on Friday that 216,480 DFX had been redeemed for roughly 2,250 USDT in payouts. The recovery pool holds 3.11 million USDT from protocol assets. Velocity will direct between 60% and 90% of its net protocol revenue into the recovery pool. That revenue contribution amounted to just 31 USDT after the first day. Tether committed up to $127.5 million to support the relaunch and user recovery, but the dashboard had not yet recorded a contribution from Tether. Strategic partners pledged up to $20 million, but the dashboard had not yet reflected that funding either. The Drift Foundation said in a September 30 update that roughly $295.4 million was stolen in the April 1 attack. Cybersecurity firm Mandiant identified the hacker as UNC6862, a North Korean threat group. The stolen assets were transferred to Ethereum through blockchain bridges. Three attacker wallets still hold 107,165 ETH worth nearly $286 million. A fourth wallet moved 23,094 ETH through crypto mixer Tornado Cash in July. The Drift Foundation said about $9.2 million of the stolen funds has been frozen so far. Returning the frozen funds requires a law enforcement order. The foundation said the frozen funds would ideally enter the DFX recovery pool once cleared by law enforcement.