Key Takeaways
- Circle is looking to bring USDC to Sony’s upcoming blockchain.
- Initially, Circle will integrate bridge USDC into Sonieum.
- Circle faces allegations of lax security measures.
Stablecoin issuer Circle is partnering with Sony’s upcoming blockchain project, Soniuem, to bring USDC to the new platform.
While the deal is a significant milestone for both companies, the development comes as concerns simmer over Circle’s approach to security.
ZachXBT, a well-known blockchain sleuth, has accused the company of not doing enough to curb crime, sparking a controversy that could cast a shadow over the new partnership.
Sonieum To Integrate Bridged USDC
Circle will integrate bridged USDC into Sonieum as part of its partnership, allowing the layer 2 blockchain network to use USDC as a primary exchange token.
Bridged USDCs are a form of USDC compatible with Ethereum Virtual Machine (EVM) blockchains, such as Sonieum. They technically act as a stand-in for native USDC stored on Ethereum.
The advantage of bridged USDC is that developers building on layer 2 blockchains can instantly power decentralized apps with digital dollar payments.
Sony, in an official statement, noted that the firm plans to integrate native USDC issuance on Sonieum soon.
Sonieum is a joint blockchain venture between Sony Group and Singapore-based Startale Labs, launched in late August.
The Ethereum layer 2, which promises to simplify Web3 experiences with boosted accessibility and efficiency, has already garnered investments from major names, including Samsung.
While Sony and Circle’s partnership marks a major development, it doesn’t come without controversy as the latter faces allegations of lax security measures.
Circle Put on Blast
On-chain investigator ZachXBT recently put Circle on blast for its lack of timely action in blocking or freezing assets tied to decentralized finance hacks.
The blockchain sleuth’s scathing critique alleges that Circle prioritizes profit over ecosystem well-being, failing to take decisive action against illicit transactions.
ZachXBT pointed to Circle’s inaction, stating that the company has consistently neglected to “blacklist” exploitative DeFi hacks, even when presented with ample opportunities to do so.
Furthermore, they highlighted Circle’s slow response in freezing USDC assets linked to the notorious North Korean hacking group Lazarus, taking nearly four and a half months to act.
In a tweet, ZachXBT contrasted Circle’s response with that of other stablecoin issuers, such as Tether and Paxos, which froze their respective stablecoins in April, over five months before Circle took similar action.
This disparity has sparked concerns about the company’s commitment to safeguarding the crypto ecosystem.
Critics argue that by dragging its feet, Circle allowed bad actors to convert stolen assets into other decentralized crypto assets, making tracking and recovering the funds difficult.
Circle has yet to respond to the allegations.
Prashant Jha is a seasoned crypto journalist based in Delhi, India, with a Bachelor’s Degree in Computer Science Engineering. Passionate about the evolving world of blockchain and cryptocurrencies, he has been a dedicated voice in the industry since 2018. Prashant’s expertise lies in regulatory reporting, where he unravels complex legal and financial developments with clarity and precision. Before joining CCN in 2024, he honed his craft at Cointelegraph, establishing himself as a trusted name in crypto journalism.
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