Circle Faces Backlash Over Handling of Stolen USDC Transfers

Circle, a leading stablecoin issuer, is facing criticism over its handling of stolen USDC transfers during the recent Solana-based Drift Protocol hack. The incident occurred on April 1 and resulted in the theft of $285 million, making it the largest DeFi hack of 2026.

According to blockchain researchers, Circle's Cross-Chain Transfer Protocol (CCTP) was used to bridge more than $230 million in stolen USDC from Solana to Ethereum across over 100 transactions. This occurred during US business hours and allowed Circle time to intervene, but the company did not take action.

On-chain investigator ZachXBT pointed out that the stolen funds were held across multiple wallets for one to three hours before being bridged, providing Circle with ample opportunity to freeze the assets. In contrast, Circle had previously frozen USDC balances across 16 unrelated corporate hot wallets tied to a civil dispute on March 23.

Circle has since blacklisted approximately $117 million across 601 wallets, according to Dune Analytics. However, critics argue that this action was too little, too late and raises questions about Circle's priorities.