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Home > Law of Code > #185 - When Circle must freeze USDC (and when they probably should) with Austin Campbell
Podcast: Law of Code
Episode:

#185 - When Circle must freeze USDC (and when they probably should) with Austin Campbell
Category: Technology
Duration: 00:43:17
Publish Date: 2026-04-13 07:03:00
Description:

When does U.S. law require Circle to freeze USDC? It's a question many are asking after a series of wallets were frozen in connection to a sealed civil case, and again after Solana's Drift Protocol was drained of $285 million.

Jacob Robinson is joined by Austin Campbell, founder of Zero Knowledge Consulting and adjunct professor at Columbia Business School, for a masterclass on the legal framework governing stablecoin freezes.

Timestamps:

➡️ 0:00 — Intro

➡️ 2:00 — The March 2026 freeze of 16 wallets tied to a sealed civil case

➡️ 4:31 — How bank freezes actually work

➡️ 7:27 — Circle's legal obligation to freeze

➡️ 9:40 — Does Circle's terms of service even apply to secondary holders?

➡️ 11:24 — The privity problem

➡️ 13:20 — The five-piece legal framework that functions like a safe harbor for institutions freezing assets

➡️ 16:43 — DeFi's second-order exposure to asset freezes

➡️ 18:29 — Can DeFi adapt?

➡️ 21:03 — Circle's response to the Drift exploit

➡️ 22:34 — DeFi and the legal system

➡️ 24:27 — Bitcoin as the ideologically consistent alternative

➡️ 28:18 — Why people want intermediaries with liability

➡️ 31:04 — The Drift exploit: why Circle should have frozen USDC

➡️ 36:34 — The exploit difficulty

➡️ 38:27 — Real world assets on chain: the DeFi trilemma

Sponsor: Day One Law, a boutique corporate law firm that provides strategic legal counsel to startups, crypto projects, and Web3 innovators. ⁠You can get in contact with them via this link⁠: ⁠⁠https://www.dayonelaw.xyz/#contact.

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