Rand Hindi, co-founder of Zama, explained that the blacklist placed by Circle on the protocol’s contract title has nothing to do with Zama at all.
Reports indicate that approximately $12.6 million of user funds have been locked in Zama’s USDC secret token on Ethereum.
Why was Zama’s contract frozen?
Following reports that $12.6 million of user funds on Zama became inaccessible, the company’s co-founder, Rand Hindi, said, I took to X To give an explanation. He also gave credit to on-chain investigator ZachXBT for his role in identifying the source of the problem.
The story It goes to say that the address linked to the Overnight Finance hack deposited over $12.5 million USD into Zama’s cUSDC shell. However, since the wrapper was not very popular at the time, this single deposit represented almost 100% of all the funds in the contract.
“This has nothing to do with Zama or privacy,” Hindi insisted to X. “The problem stems from a headline related to an overnight finance hack.”
A Telegram tracker for the USDT/USDC blocklist shows that Zama’s contract address was frozen at 01:08 UTC on Friday. The target address, 0xe978…72B2, is publicly labeled on Etherscan as “Zama: cUSDC Token.”
Why did Circle’s ban affect non-participating users?
Department compliance system The depositor’s wallet was flagged, but because those funds were located inside Zama’s CUSDC contract, the standard holding freeze was applied to the entire contract address rather than just the individual depositor.
ZAMA symbol It fell 18.2% during the day, falling from about $0.039 to $0.032 over the course of about five and a half hours. Trading volume rose 61% within 24 hours to $73.9 million, roughly equivalent to the token’s market cap of $77.5 million. The code has been partially redeemed to $0.035, but this is still below its value before the freeze.
Hindi stressed that the protocol “is not a mixer” and does not block senders or recipients, only balances and amounts. He pointed to a depositor’s cUSDC transaction history on Blockscout as evidence that transactions are still traceable.
As an immediate precaution, Zama has temporarily suspended the cUSDC, cUSDT and cWETH contracts pending a full investigation. Hindi said the team would publish a post-mortem report and a framework for dealing with future freezing requests.
If Zama’s legal team fails to do so Convince the department Or the court issued the restraining order to narrow the scope of the freeze to the specific depositor who was reported, and legitimate users who deposited USDC in cUSDC will remain blocked.
