What is Drift (DRIFT)?

Deep Dive

1. Purpose & Value Proposition

Drift Protocol was created to bring the speed, user experience, and advanced trading features of centralized exchanges into the decentralized finance (DeFi) space. Its core mission is to solve capital inefficiency in DeFi trading by allowing users to employ diverse assets as collateral for leveraged positions. This opens sophisticated strategies like hedging and arbitrage to a broader audience while maintaining the transparency and self-custody benefits of DeFi.

2. Technology & Architecture

Built on the high-throughput Solana blockchain, Drift employs a hybrid liquidity model. This system merges a decentralized limit order book for precise order matching with a virtual AMM (vAMM) that provides deep, on-demand liquidity. The recent v3 upgrade, launched in December 2025, processes trades 10x faster, with 85% of market orders filling within a single 400-millisecond Solana slot (CoinDesk). This architecture enables gasless trading, minimal slippage, and supports advanced order types.

3. Tokenomics & Governance

The DRIFT token has a fixed supply of 1 billion. It powers a multi-branch DAO where stakers can vote on Drift Improvement Proposals (DIPs) covering listings, fees, and upgrades. Staking DRIFT provides tangible utility, including discounts on trading fees and a share of protocol revenue generated from trading fees and liquidations, aligning holder incentives with the platform's growth and security.

Conclusion

Fundamentally, Drift is a next-generation DeFi infrastructure project that leverages Solana's performance to create a fast, efficient, and user-governed trading venue for derivatives and spot markets. How will its focus on institutional-grade services and capital efficiency reshape the competitive landscape for decentralized exchanges?