Circle, the issuer behind the USDC stablecoin, has frozen two cryptocurrency wallets containing nearly $58 million linked to the Libra memecoin scandal, according to blockchain intelligence firm Arkham.
ALERT: $57M OF USDC ASSOCIATED WITH LIBRA FROZEN BY CIRCLE
— Arkham (@arkham) May 28, 2025
Two Libra accounts have just been frozen by Circle, including the Libra deployer wallet.
These accounts contained a combined $57M in USDC which is now immobile. pic.twitter.com/HpmaM5HwVJ
One wallet, holding $44.59 million in USDC, and another — reportedly the deployer wallet for the Libra token — containing about $13 million, were both locked earlier this week. While the precise reason for the freeze remains unclear, it's common for major stablecoin issuers like Circle and Tether to halt token transfers in emergency situations or when legal authorities intervene.
The freeze has sparked debate over who initiated the legal request. Burwick Law, a firm previously connected to projects like HAWK and Pump.fun, claimed that the U.S. District Court for the Southern District of New York issued a temporary restraining order to block the wallets. In contrast, Martin Romeo, a plaintiff in the Argentine case against Libra, stated the action was taken through Argentina’s local justice system.
Incorrect. Yesterday the U.S. District Court (SDNY) granted Burwick Law’s emergency TRO, supported by co-counsel Tim Treanor, freezing ≈ $57.65 M USDC held at Circle.
— Burwick Law (@BurwickLaw) May 28, 2025
Circle has not commented publicly on the matter.
Launched on the Solana blockchain, Libra drew massive attention after being associated with Argentine President Javier Milei, who once promoted the token as a tool to support startups and small businesses. His endorsement, which included a social media post with a link to the token’s smart contract, helped propel LIBRA's market cap to over $2 billion. But the hype was short-lived. The token’s value plummeted by over 90%, leading to a wave of investor losses and public backlash.
Milei later distanced himself from the project, claiming he had no prior knowledge of it and never intended to encourage investment. However, Hayden Davis, CEO of Kelsier Ventures and alleged advisor to the project, claimed he paid Milei’s sister to secure the president’s support.
The fallout from the Libra collapse has led to fraud charges against President Milei, although he has denied any wrongdoing. Earlier this month, an Argentine judge ordered the unsealing of the president’s and his sister’s bank accounts as part of an ongoing investigation. Curiously, just days later, the government announced that the investigative unit handling the Libra case had been disbanded, adding another twist to the scandal.
