[76153] Freezing of $12.6 Million in USDC Assets: A DeFi Mystery
[76153] Freezing of $12.6 Million in USDC Assets: A DeFi Mystery
Circle has frozen millions of dollars belonging to the Zama protocol following involvement in an Overnight Finance hack case, a move that has sparked controversy in the crypto community.
Freezing of Assets at Zama Sparks Echoes in the DeFi World
On May 30, 2026, it was reported that Circle froze a Zama cUSDC contract on the Ethereum network, a move that led to the blocking of user funds worth approximately $12.6 million. According to the report on Coingraph | News, the step was taken after the contract address was added to the company's blacklist.
The investigator ZachXBT, known in the community for exposing crypto scams, noted that the move is related to legal proceedings surrounding the Overnight Finance platform. According to the joint report by channels such as Futures Trading & Crypto, Bitcoin | Finance | Crypto, and Stocks, Shares, Trading & Crypto, claims were raised by users that the project team was involved in a "rug pull." ZachXBT added that the company Patagon Management, which is involved in a civil lawsuit against Overnight Finance, may have made a misrepresentation to the court regarding the connection between the frozen address and the Zama contract, without the original team's knowledge.
Conversely, the CEO of Zama provided a different version of events, emphasizing that the problem "is not related to Zama or privacy concerns." According to him, the source of the problem is an address linked to a previous hack at Overnight Finance, which led to the transfer of about $12.5 million in USDC to the company's account. The CEO described the situation as a "common scenario of an injunction in the DeFi world" and expressed disappointment that he was not notified in advance by the authorities or Circle so that he could take appropriate measures.
While the information points to a regulatory attempt to address hack funds, the case highlights the complexity and risks involved in using stablecoins held by centralized entities that possess freezing authority.