In recent news, North Korean hackers are suspected of stealing extensive amounts of cryptocurrency, with estimates suggesting they may have gained access to as much as hundreds of millions of dollars. Now, a court in the United States is faced with determining whether a significant player in the stablecoin industry had a responsibility to intervene.

Circle: The Core of the Controversy

A class action lawsuit has emerged, naming Circle Internet Group as the accused party. Plaintiffs contend that Circle possessed both the ability and the necessary knowledge to thwart around $280 million in USDC that was illicitly transferred between blockchains but failed to take action.

This lawsuit has been initiated by Drift Protocol investor Joshua McCollum, who represents over 100 individuals impacted by the theft. Their legal representatives assert unequivocally: Circle’s inaction facilitated criminal activity.

The attack on Drift Protocol on April 1 involved perpetrators draining funds and transferring them from Solana to Ethereum utilizing Circle’s Cross-Chain Transfer Protocol. Reports suggest that this transfer operation unfolded over several hours, indicating a significant window of opportunity that was not leveraged to prevent the theft.

A notable detail supporting the plaintiffs’ case is that merely days prior to the attack, Circle acted quickly to freeze 16 USDC wallets related to a separate US civil case. Legal experts argue that if Circle could mobilize in a timely fashion for a legal matter, there was no justification for their inaction in this instance. This crucial detail has become central to the ongoing lawsuit.

The issue needs clarity. If you are a truly decentralized protocol, you shouldn’t have the authority to freeze. If not, then it is your duty to act. This vague stance of only acting via court orders undermines accountability.

— James Seyffart (@JSeyff) April 16, 2026

Charges of Negligence and Facilitation of Crime

This lawsuit accuses Circle of two primary offenses: negligence and the aiding and abetting of conversion, which is a legal term for assisting in the unlawful appropriation of property. Legal representation for the plaintiffs is provided by the firm Mira Gibb. While specific damages remain undetermined, they will be addressed during the trial.

Circle has not issued any public statements regarding the claims made against it.

Crypto analytics company Elliptic has implicated North Korean state-backed actors in this breach. Their analysis indicates that more than 100 transfers occurred through Circle’s infrastructure within standard U.S. business hours. Once the funds were laundered into Ethereum, they were further obscured via Tornado Cash, a privacy-focused protocol.

The Reactions Divide Opinions

While some are criticizing Circle’s lack of action, not everyone shares this viewpoint. Lorenzo Valente, the director of digital asset research at ARK Invest, has defended Circle by stating that it was prudent to refrain from acting without explicit legal mandates.

Valente raised concerns about the implications of granting a company like Circle unilateral authority to freeze funds based on subjective assessments. He questioned how such a power could potentially lead to politically motivated decisions, significantly blurring the lines between criminality and dubious financial activities elsewhere worldwide.

Featured image from B&G Lawyers, chart data from TradingView