Circle Faces Lawsuit Over $280 Million Drift Protocol Hack
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Circle, the issuer of USDC stablecoin, is facing a class-action lawsuit following a $280 million Drift Protocol hack. The lawsuit alleges that Circle did not intervene to freeze the stolen funds despite being capable of doing so.
Circle is facing a class-action lawsuit after a $280 million hack on the Solana-based Drift Protocol on April 1. The attackers drained the funds in under 12 minutes and transferred nearly $230 million of USDC from Solana to Ethereum via Circle's Cross-Chain Transfer Protocol over eight hours. The lawsuit, filed in a Massachusetts district court, alleges that Circle was negligent and conspired by not freezing the stolen funds. The plaintiffs claim that Circle had previously frozen wallets in a different case, demonstrating its capability to intervene. The hack, suspected to be carried out by North Korean state-backed hackers, caused significant losses in DeFi, with the total value locked on Drift decreasing by $300 million. The incident raises concerns over the accountability of centralized entities in decentralized financial systems.
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