Circle CEO Jeremy Allaire has reaffirmed the company’s policy of not freezing USDC transactions without a court order, even as hackers exploit the stance to steal hundreds of millions in digital assets. The position, framed as a commitment to decentralization and due process, has drawn sharp criticism from cybersecurity experts and victims of recent exploits.
USDC, the second-largest stablecoin with over $30 billion in circulation, operates under a centralized governance model where Circle maintains freeze capabilities. However, Allaire emphasized in a CoinDesk interview that the company exercises this power judiciously to avoid setting ‘dangerous precedents.’ Analysts note this approach contrasts with Tether’s more aggressive freezing of USDT in theft cases.
Blockchain security firm CertiK estimates $430 million was stolen in Q1 2026 through exploits targeting protocols using USDC, with recovery rates below 15% for non-frozen assets. ‘Every minute matters in these heists,’ said CertiK’s Kang Li. ‘By the time courts act, funds are often irrecoverable.’
The debate highlights tensions in crypto’s hybrid systems – centralized issuers operating in decentralized ecosystems. Some lawmakers are now pushing for stablecoin legislation that would mandate faster response protocols.