Zama says Circle froze cUSDC contract due to specific wallet issue

Ethereum-based privacy protocol Zama has issued an official statement regarding Circle's freeze of its cUSDC contract. Zama explained that Circle's compliance system identified a specific wallet belonging to an external depositor as problematic. Because this wallet held funds within the cUSDC contract, the entire contract was automatically frozen. The protocol clarified that the measure was not a sanction against Zama itself but an accidental consequence of a regulatory action targeting a specific address. Zama's legal team is now working to isolate the wallet, and access for unaffected users is expected to be restored soon. The statement follows an earlier report from on-chain analyst ZachXBT, who revealed that Circle had blacklisted the contract.