TechFlow News, April 3: According to on-chain investigator ZachXBT, Circle failed to promptly freeze USDC in multiple major incidents involving illicit funds, resulting in ecosystem losses exceeding $420 million.
Specific incidents include:
- In June 2025, the U.S. Department of Justice filed a civil forfeiture lawsuit concerning the seizure of $225 million in USDT linked to a Southeast Asian “pig-butchering” crime syndicate. Over 1.7 million USDC were transferred via intermediary addresses to Circle’s deposit addresses, yet Circle took no action;
- In October 2024, Radiant Capital suffered a $58 million hack by the Lazarus Group. The attackers exploited an authorization vulnerability to withdraw USDC, but Circle failed to freeze the associated addresses in a timely manner;
- In March 2025, the infrastructure of the sanctioned exchange Garantex was seized by law enforcement agencies across multiple countries. Tether froze $22 million worth of assets in related addresses, whereas Circle took no action regarding over 200,000 USDC held at the same addresses;
- On February 21, 2025, Bybit suffered a $1.5 billion hack by the Lazarus Group. After law enforcement and private entities submitted freeze requests, Tether promptly froze 106,000 USDT, while Circle delayed freezing 338,000 USDC.
ZachXBT stated that these incidents reflect systemic issues in Circle’s compliance decision-making and have caused tangible harm to the ecosystem.
Add to Favorites
Share to Social Media
