Circle's biggest selling point may be becoming its biggest liability. On-chain investigator ZachXBT's “Circle Files” allege that the USDC issuer has inconsistently applied its freeze powers.
Circle was too slow in 15 cases involving more than $420 million in allegedly illicit funds since 2022, yet broad enough to sweep 16 operational business wallets in a sealed US civil matter. The wallets were tied to exchanges, casinos, and forex services that ZachXBT said did not appear connected.