Analyst questions Circle's USDC freeze, citing weak grounds

On-chain analyst ZachXBT has questioned a recent decision by USDC issuer Circle to freeze funds in several wallets. The analyst, who has approximately 985,000 followers on X, stated that on March 24, Circle froze the USDC balances in 16 unrelated hot wallets due to their alleged involvement in a civil lawsuit. ZachXBT argued that a simple review of on-chain activity clearly shows the wallets had no signs of suspicious behavior. He criticized Circle for responding immediately to what he called a request riddled with logical fallacies while ignoring users when actual incidents occur. After he publicized the issue, Circle unfroze five of the 16 wallets. ZachXBT asserted that the self-proclaimed expert who requested the freeze, the judge who ordered it, and Circle, which executed it, should all be held responsible. He added that even after the freeze was lifted, the affected wallets are still unable to receive withdrawals from major exchanges, and he has demanded an explanation from Circle.