{"id":72585,"date":"2026-04-17T08:59:11","date_gmt":"2026-04-17T01:59:11","guid":{"rendered":"https:\/\/hbbgroup.net\/stablecoin-issuer-circle-faces-lawsuit-over-230m-drift-protocol-hack\/"},"modified":"2026-04-17T08:59:11","modified_gmt":"2026-04-17T01:59:11","slug":"stablecoin-issuer-circle-faces-lawsuit-over-230m-drift-protocol-hack","status":"publish","type":"post","link":"https:\/\/hbbgroup.net\/vi\/stablecoin-issuer-circle-faces-lawsuit-over-230m-drift-protocol-hack\/","title":{"rendered":"Stablecoin issuer Circle faces lawsuit over $230M Drift Protocol hack"},"content":{"rendered":"
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Circle Internet Group is facing a class action lawsuit led by a Drift Protocol investor claiming it failed to freeze funds stolen in a $280 million exploit of the protocol on April 1.<\/p>\n

The lawsuit was filed<\/a> by Drift investor Joshua McCollum on behalf of over 100 members in a US district court in Massachusetts on Wednesday, which accused Circle of allowing the attackers to transfer<\/a> about $230 million worth of USDC (USDC<\/a>) from Solana to Ethereum via Circle\u2019s Cross-Chain Transfer Protocol (CCTP) over several hours without intervention.<\/p>\n

\u201cCircle permitted this criminal use of its technology and services,\u201d attorneys representing McCollum wrote, adding: \u201cThese losses would not have occurred, or would have been substantially reduced, had Circle taken timely action.\u201d<\/p>\n

The suit accuses Circle of aiding and abetting conversion<\/a> as well as negligence. Mira Gibb, the law firm representing McCollum and other Drift investors, is seeking damages, with the final amount to be determined at trial.<\/p>\n

The case touches on a legal grey area around crypto companies that retain control over user funds. While such companies may have the technical ability to intervene or freeze assets, they often cite regulatory constraints or the lack of immediate legal authority as reasons for inaction \u2014 leaving accountability unclear as exploits unfold in real-time.<\/p>\n

Source: <\/em>James Seyffart<\/em><\/a>
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McCollum\u2019s lawyers pointed out that Circle froze 16 USDC wallets in connection with a sealed US civil case about a week before the Drift incident to argue that Circle had the technical capacity to do the same.<\/p>\n

Cointelegraph reached out to Circle for comment, but didn\u2019t receive an immediate response.<\/p>\n

Crypto analytics firm Elliptic suspected<\/a> the exploit was committed by North Korean state-backed hackers, who made over 100 transactions via Circle\u2019s bridging technology during US working hours, where the stablecoin company<\/a> is based.<\/p>\n

Related: <\/strong><\/em>Ukraine arrests FBI-wanted cybercrime suspect, seizes $11M in assets<\/strong><\/em><\/a><\/p>\n

The funds were converted into Ether (ETH<\/a>) and sent through the Tornado Cash<\/a> privacy protocol to launder the proceeds and obscure the trail.<\/p>\n

Circle was put in a lose-lose position: ARK Invest<\/h2>\n

While Circle faced backlash<\/a> for the inaction, ARK Invest\u2019s director of research for digital assets, Lorenzo Valente, argued on Thursday that it made the right decision, arguing that freezing funds without a legal order opens the door for arbitrary discretion.<\/p>\n

\u201cEvery future freeze is now a judgment call. Every non-freeze is a political statement. Why freeze the Drift hacker but not that sketchy Nigerian fraud wallet? Why this protester but not that one?\u201d<\/p><\/blockquote>\n

While Valente sided with Circle\u2019s decision, he speculated that the stolen funds will likely fund North Korea\u2019s nuclear weapons program:<\/p>\n

\u201cWhether Circle got it right comes down to how much you weigh rule-of-law principles vs concrete harm. Reasonable people disagree.\u201d<\/p><\/blockquote>\n

Magazine: <\/strong><\/em>Are DeFi devs liable for the illegal activity of others on their platforms?<\/strong><\/em><\/a><\/p>\n