ZachXBT criticized Circle for the unjustified freezing of wallets., 2026/03/25 12:45:06

Blockchain researcher ZachXBT has criticized Circle, the issuer of the USDC stablecoin, for freezing 16 wallets that he believes are not linked to illicit activities and were utilized for standard business transactions.

According to his findings, the wallets were frozen on the evening of March 23. They were used for legitimate payments, including on cryptocurrency exchanges, online casinos, and forex platforms. Transaction analysis, as stated by ZachXBT, did not reveal any connections between the addresses and does not support the existence of an organized group.

The researcher claims that the decision to block the wallets was made without adequate verification. Circle has not disclosed the reasons for the restrictions. One of the affected wallet owners suggested that the freeze might be related to a civil lawsuit in the United States, although details remain undisclosed.

ZachXBT also reminded that he had previously pointed out the use of USDC by North Korean developers for making payments, including to circumvent sanctions. He noted that in such instances, freezes do not always occur, while in other cases, the company restricts access at the request of U.S. authorities.

In September 2024, the researcher stated that Circle delayed the blocking of wallets associated with the North Korean group Lazarus by approximately five months compared to other stablecoin issuers.

In light of these statements and the discussion surrounding the CLARITY bill on stablecoin regulation, Circle’s shares fell by as much as 25% on Tuesday, March 24, before closing down more than 20% at $101.17, down from an opening level of $126.35.

According to AMLBot, from 2023 to 2025, Circle has frozen 109 million USDC across 372 addresses.