Circle froze $1.1 billion USDC after Binance hack

Circle froze $1.1 billion USDC following an attack on Binance. The company's director, Disparte, explained that Circle blocks USDC addresses only after law enforcement receives the appropriate court order. The company halts the ability to move these assets but does not decide who owns them or whether they are subject to confiscation. Such matters fall under the jurisdiction of law enforcement and the courts. Freezing stablecoins also does not guarantee the return of funds to affected clients: separate orders are required for the distribution of these assets.

Circle's management urges law enforcement to engage more actively with exchanges, token issuers, analytics companies, and custodial services when incidents occur. According to Disparte, no organization can handle hackers alone. Circle continues to investigate the attack on Binance, added the department director.

Hackers breached Binance on the night of October 29-30. According to the U.S. Federal Bureau of Investigation, the attack was carried out by North Korean hackers from the TraderTraitor group. By October 30, Circle had frozen over $800 million USDC, and Tether about $1.567 billion USDT. Later, the amount of Circle's frozen funds grew to $1.1 billion.

In July, Circle refused to issue new USDC stablecoins to compensate a Wisconsin resident who fell victim to crypto fraud. The American lost over 381,000 USDC by transferring stablecoins from the Crypto com exchange to the scammer's address.