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Circle Defends USDC Policy Amid Drift Protocol Exploit

• Circle faced criticism for not freezing $230 million in stolen USDC during the $285 million Drift Protocol exploit.
• The company states it only freezes assets under legal compulsion, not community pressure.
• Circle is lobbying for the GENIUS and CLARITY Acts to establish a legal framework for stablecoins and digital assets.
• The Drift exploit was executed by North Korean hackers, causing a collapse in Drift’s total value locked from $550 million to under $250 million.
• The GENIUS Act may restrict interest payments on stablecoin reserves, impacting Circle’s revenue model.

Circle emphasizes its adherence to legal protocols in asset freezing, advocating for legislative clarity through the GENIUS and CLARITY Acts following the Drift Protocol exploit. The incident highlights regulatory gaps affecting stablecoin operations.