An Analyst’s Allegations Against Circle

In a striking revelation, on-chain detective ZachXBT has pointed a finger at Circle for apparent systematic compliance lapses. His analysis suggests that since 2022, over $420 million in USDC was not promptly frozen following a series of high-profile cyber incidents—a finding that raises significant questions about the issuer’s adherence to anti-money laundering (AML) protocols.

Incident Details and Financial Implications

ZachXBT highlighted several incidents where substantial sums remained mobile post-attack despite having mechanisms to halt such movements. This included approximately $232 million transferred during the Drift Protocol breach, $61 million from the Cetus exploit, and $57.5 million linked to an attack on Mango Markets. Additionally, he pointed out $45 million in losses from the Nomad Bridge incident and another $3 million from a SwapNet hack.
According to ZachXBT, these scenarios underscore delays in reaction times by the stablecoin issuer. The expert argues that faster intervention could have significantly reduced damages.

The Critical Nature of Rapid Response

Unlike decentralized assets, centralized control allows for quick freezing of USDC funds. This capability makes response speed a pivotal factor in limiting hacking impacts. As ZachXBT observes, stablecoin issuers must act swiftly during such crises to secure the broader crypto ecosystem.
The critique extends beyond just Circle’s actions—or lack thereof—in these incidents. It highlights broader responsibilities for companies issuing stablecoins: ensuring timely responses to protect their platforms and users effectively.

Circle’s Position and Industry Context

As this report emerged, Circle had yet to comment on these specific allegations. However, they have previously emphasized compliance with regulatory standards and cooperation with law enforcement agencies.
It’s crucial to remember that March 2026 witnessed substantial losses exceeding $50 million due to various hacks across the crypto market landscape. Such events underline ongoing security challenges within this rapidly evolving sector.
In summary, ZachXBT’s findings call for introspection within cryptocurrency enterprises concerning proactive measures against illicit activities—a step deemed essential not only for safeguarding assets but also fostering trust among stakeholders in this dynamic digital space.