Circle Freezes $58M in USDC Linked to Libra Scandal: Arkham

Stablecoin issuer Circle has frozen two wallet accounts linked to the Libra memecoin scandal. These accounts tagged as frozen on the Solana block explorer Solscan contain about $57.6 million in USDC.

According to data from Arkham, one frozen Libra wallet contains $44.59 million in USDC. Another wallet, the deployer wallet for Libra, holds around $13 million worth of USDC. 

ALERT: $57M OF USDC ASSOCIATED WITH LIBRA FROZEN BY CIRCLE

Two Libra accounts have just been frozen by Circle, including the Libra deployer wallet.

These accounts contained a combined $57M in USDC which is now immobile. pic.twitter.com/HpmaM5HwVJ

— Arkham (@arkham) May 28, 2025

Major stablecoin issuers such as Circle and Tether can freeze tokens under their blocklisting policies. They are known to restrict token transfers during legal investigations or urgent scenarios like major security breaches. However, it is unclear who requested Circle to freeze the tokens. 

Burwick Law claimed that the U.S. District Court for the Southern District of New York granted a restraining order to freeze the wallets. This law firm specializes in litigation cases around cryptocurrencies.  Meanwhile, Martin Romeo, a plaintiff in the Argentine Libra token case, stated that he and other plaintiffs sought the order. He claimed they requested it through the local justice system.

Libra Memecoin Scandal

The Solana-based memecoin Libra gained widespread attention for its association with Argentinian President Javier Milei. His involvement in the token fueled its meteoric rise, which was eventually followed by a collapse in value.

In February, Milei publicly promoted Libra as a token intended to help small businesses and startups in Argentina. Following this move, LIBRA’s market cap surged to over $4 billion before quickly reversing course and crashing by more than 90%.

The memecoin’s sudden decline sent shockwaves through the crypto community, with speculation that market manipulation contributed to the devaluation. Milei then withdrew his support for the project, saying he had no advance knowledge of it and never intended to encourage people to invest. 

Following the collapse, Milei faced fraud charges filed by local lawyers over his involvement in the memecoin. The opposition lawmakers also called for his impeachment. 

Amid an ongoing legal investigation into Milei’s involvement, a local judge requested detailed records of all LIBRA transactions. Earlier this month, the president disbanded the Investigation Task Unit (UTI) investigating the scandal surrounding the LIBRA memecoin. This move attracted considerable criticism with many questioning the government’s commitment to transparency.

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