Circle CEO: Iran unlikely to use USDC for Hormuz tolls

Jeremy Allaire, CEO of Circle, told a Seoul press conference on April 13 that it is highly unlikely Iran would use USDC to pay passage fees at the Strait of Hormuz. He pointed to Circle’s compliance controls and to public research from the United Nations and forensic firms showing sanctioned actors tend to use other stablecoins.

Allaire addressed criticism of Circle’s response to the April 1 Drift Protocol exploit, in which attackers stole an estimated $285 million and bridged roughly $230 million in USDC from Solana to Ethereum over about six hours. Circle did not freeze the bridged funds during that window. He explained Circle can only freeze wallets when directed by law enforcement or a court and warned that leaving those decisions to private firms raises a moral quandary.

To close legal gaps exposed by incidents like the Drift exploit, Allaire urged lawmakers to include safe-harbor provisions in stablecoin legislation that would permit issuers to freeze assets preemptively in extreme circumstances, but only when the law explicitly allows it.

Allaire discussed a CLARITY Act provision that would ban passive yield on stablecoins and noted the GENIUS Act already bars stablecoin issuers from paying interest to holders. He noted the main effects would fall on distributors such as exchanges and wallet providers that currently offer rewards; those platforms could still provide activity-based incentives but could not present stablecoin balances as deposit substitutes.

During the Seoul visit, Allaire met executives from major exchanges and banks and signed memorandums of understanding with two domestic exchanges. He noted Circle does not plan to issue a Korean-won stablecoin itself and intends to offer its technology stack to local issuers, citing likely domestic bank-led requirements for a won-linked token.

Circle issues USDC, a dollar-backed stablecoin used across multiple blockchains. Regulators and lawmakers are drafting rules for stablecoins that focus on consumer protections, anti-money-laundering controls and the authority of issuers to act in illicit flows.