Key Highlights
- Circle launched a native USDC Bridge that lets users move USDC across blockchains using a burn-and-mint system.
- The bridge removes wrapped tokens and third-party liquidity pools, aiming to make transfers more secure.
- Drift Protocol is switching to USDT after a $296M exploit, while Circle is facing a U.S. lawsuit over how the stolen USDC moved during the attack.
Circle, the issuer of USDC, has introduced a native USDC Bridge that allows users to move USD Coin (USDC) across blockchains by burning tokens on one chain and minting the same amount on another.
According to the X post, this bridge removes the need for third-party liquidity pools and wrapped tokens, which have been linked to past security issues.
Instead, the process relies on a burn-and-mint model, where USDC is destroyed on the source network before being recreated on the destination network.
The process begins when a sender deposits USDC for burning on the source network. After that, Circle checks and confirms the transaction. Once confirmed, the same amount is created on the destination blockchain.
The platform also handles routing and gas fees, so users do not need to manage the technical part. This makes the process feel more like moving money within one app instead of jumping across different platforms.
Growing stablecoin usage worldwide
The rollout comes as stablecoins like USDC are increasingly used for payments and trading. According to data from Forbes, stablecoins handled about $33 trillion in transactions in 2025, more than double the annual volume of traditional payment networks.
USDC alone accounted for roughly $8.3 trillion in transfers in January 2026. Right now, USDC is active on 32 blockchains, and this burn-and-mint system works on 21 of them. Also, over $20 billion is moved across chains every month using this system.
Criticism over Drift Protocol exploit
However, the company is facing scrutiny from the crypto space over how it handled the recent exploit of Drift Protocol, which lost about $296 million, of which $232 million was in USDC. Critics have questioned why Circle did not freeze the transaction before the attacker moved the funds.
Meanwhile, Drift Protocol has announced plans to stop using USDC and switch to Tether in its plan to relaunch on the Solana network.
The platform said it will adopt USDT as its main settlement asset moving forward. The decision comes alongside a proposed $147.5 million support package led by Tether and other partners. This funding includes a mix of credit facilities, ecosystem support, and loans to market makers to help restart trading activity.
Drift has also introduced a recovery plan, where a portion of future revenue will be allocated to compensate affected users. The total loss is estimated at about $295 million, and any recovered funds will also be added to this pool.
Circle hit with lawsuit
In addition, Circle has been named in a lawsuit in the United States over its role in the exploit. A class action lawsuit filed in federal court in Massachusetts alleges that the company failed to act as attackers moved approximately $230 million in USDC using CCTP.
The complaint alleges that the delay allowed hackers to move funds across chains over several hours, raising concerns about oversight in core crypto infrastructure.
Also Read: $20M Crypto Scam Ends in 23-Year Sentence for Texas Man
