Circle Hit With Class Action Lawsuit Over $285M Drift Protocol Hack
Circle is facing a lawsuit from Drift Protocol investors after a $285 million hack, alleging insufficient action to freeze stolen USDC.Summary
Stablecoin issuer Circle is being sued by investors of Drift Protocol following a $285 million exploit of the DeFi platform in April. The lawsuit claims Circle failed to adequately freeze stolen funds as hackers moved $232 million in USDC through its Cross-Chain Transfer Protocol. Circle defends its actions, stating it only freezes assets when legally required, and CEO Jeremy Allaire warned against unilateral freezing decisions. Drift Protocol has linked the hack to North Korean state-affiliated hackers who infiltrated the company over six months. While Circle maintains it acted within legal bounds, the incident sparked criticism, with some questioning its support for projects facing major incidents. Tether has committed up to $127.5 million in recovery funds, positioning itself as more responsive in such situations. The case highlights broader concerns about stablecoin issuers' responsibilities in preventing illicit finance, with data showing significant stablecoin transactions linked to illegal activities.
(Source：Decrypt)