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.

Resources:

📓 Circle's April 10, 2026 statement on the Drift exploit and USDC freeze authority by Dante Disparte
📓 ZachXBT's X thread on Circle's USDC freeze history

Also: I'm re-launching the Law of Code newsletter as the world's shortest legal newsletter! You can ⁠stay updated on emerging tech law for free here⁠. https://lawofcode.beehiiv.com/

Any feedback on this episode? Or how to improve the podcast? Click here. https://forms.gle/W4d2a5aHuLJjuNdn7

Disclaimer: This podcast is for informational and educational purposes only and does not constitute legal or investment advice. Views expressed by guests are their own and do not necessarily reflect those of their employers. Listening to this podcast does not create an attorney-client relationship.

#185 - When Circle must freeze USDC (and when they probably should) with Austin Campbell