Circle has restored access to 130,966 USDC in one previously frozen wallet, reversing part of a controversial enforcement action that affected 16 addresses. The move signals potential cracks in centralized stablecoin controls at a time when institutional reliance on USDC continues to expand.
Onchain investigator ZachXBT reported Wednesday that wallet “0x61f…e543,” linked to Goated.com, regained access to its funds after being frozen earlier this week. Data from Arkham shows the wallet holds 130,966 USDC. ZachXBT added via Telegram that additional wallets could be reinstated in the near term, though no timeline was specified.
Circle unfroze the USDC for the Goated hot wallet a few minutes ago.
— ZachXBT (@zachxbt) March 26, 2026
I expect more hot wallets to be unfrozen soon.
The crypto community needs answers from @jerallaire @circle about why this overreach ever occurred to begin with. pic.twitter.com/Hscp0RAoMY
Why Did Circle Reverse A USDC Wallet Freeze?
The reversal follows a broader freeze affecting 16 wallets tied to unrelated businesses, which ZachXBT said was linked to a sealed U.S. civil case. The lack of public disclosure contrasts with prior enforcement actions, where issuers typically cite sanctions lists or law enforcement requests. Data from DeFiLlama shows USDC’s total value locked (TVL) remains above $25 billion, highlighting the scale of assets potentially exposed to such actions.
ZachXBT criticized the process, stating, “In my 5+ years of investigations, it could potentially be the single most incompetent freeze I have seen.”
The NY civil case is sealed and they have provided absolutely ZERO basis to freeze all of these business addresses.
— ZachXBT (@zachxbt) March 25, 2026
Aaron Nathan from Willkie Farr is the unknown plaintiffs lawyer.
The expert witness is liable.
The judge is liable.
Circle is liable.
In my 5+ yrs of…
He added that the decision appeared to rely on a federal judge without a clear internal review framework. Taylor Monahan, security researcher at MetaMask, echoed concerns, writing that similar freezes lack accountability and user recourse. But how should stablecoin issuers balance legal compliance with operational transparency?
Circle has not publicly detailed the legal basis for the freeze or confirmed whether additional wallets will be restored. Still, the partial reversal suggests internal reassessment or external pressure may be influencing enforcement decisions. Market participants will now watch for further wallet reinstatements or formal clarification, particularly as regulators in the U.S. and EU tighten scrutiny on stablecoin governance.
