US law firm Gibbs Mura has launched a formal investigation into the aftermath of the $280 million Drift Protocol hack, with a specific focus on Circle, the issuer of the USDC stablecoin. The probe is examining whether Circle failed to freeze funds suspected to be linked to the stolen assets after the exploit. This scrutiny centers on the company's cross-chain transfer system, which the hackers allegedly used to move stolen funds into USDC.
The investigation raises significant questions about accountability and response protocols in the cryptocurrency industry. "The case could test how far that responsibility extends," the report notes, highlighting the tension between the power to freeze assets and the obligation to act swiftly. The outcome may influence future regulations, particularly for stablecoin issuers and service providers, potentially leading to stricter rules on fund freezing during suspicious activity.
Concurrently, Circle's stock price plummeted nearly 10% on Thursday, April 9, 2026, hitting its lowest point of the day. This sell-off was triggered by a combination of factors. Wall Street research firm Compass Point downgraded Circle's stock from "neutral" to "sell" and set a lower price target, citing heightened risk. This downgrade prompted large investors to sell their shares, accelerating the price decline.
The negative market sentiment is also fueled by ongoing regulatory uncertainty in the U.S. surrounding stablecoins, including a draft of the Clarity Act that proposed halting rewards on stablecoin balances. This environment of fear was exacerbated by the fallout from the Drift hack, which has spread concern about security across the decentralized finance (DeFi) space and indirectly linked Circle to the incident through its infrastructure.
While some analysts maintain that Circle's core business—including USDC usage for payments and trading and yields on its reserves—remains strong, the market is currently placing greater weight on uncertainty and perceived risks. The combination of a high-profile legal investigation and a bearish turn from Wall Street has created a perfect storm of negative pressure on the company.
