ZachXBT: Circle claims compliance but fails to act on hacks, thefts

On-chain analyst ZachXBT, known for exposing wrongdoing, alleged on X that Circle (CRCL) is highly deficient in its response to hacked or stolen funds, despite publicly emphasizing USDC's dollar peg and regulatory compliance. He stated that the company fails to take measures such as freezing related addresses following such incidents, calculating that damages from this inaction have totaled $420 million since 2022. ZachXBT pointed to 15 cases, including the recent exploit of Drift (DRIFT) and a hack of Bybit, where Circle's response was either slower than that of its competitor Tether or entirely absent. While acknowledging that Circle has a good product and that he personally holds USDC, ZachXBT argued that the company's decisions on regulatory compliance often lead to significant losses for customers. He stressed that this repeated and lukewarm response over three years has allowed a nine-figure sum to be drained from the crypto ecosystem, adding that Circle has the necessary resources to take action but has failed to do so. ZachXBT has previously highlighted the Drift hack, in which $280 million in crypto was stolen and subsequently swapped via Circle's CCTP without any intervention from the company.