Key Highlights
- ARK Invest sold 11,465 Circle (CRCL) shares worth about $1.21 million as legal pressure around the USDC-related Drift Protocol hack increased.
- Circle is facing a class-action lawsuit over claims it failed to freeze about $230 million in stolen USDC, despite having the ability to do so.
- Circle’s stock is in a downtrend, showing short-term market weakness as investors react to ongoing litigation.
Cathie Wood’s ARK Invest, led by Cathie Wood, reportedly sold part of its stake in Circle Internet Group (NYSE: CRCL) on April 17, 2026, through its ARK Next Generation Internet ETF, as legal pressure around a USDC-related hack continued to build in the background.
In a post on X, Ark Invest Tracker showed that the firm sold 11,465 Circle shares worth about $1.21 million during a quiet trading session .
ARK Invest trims Circle stake amid lawsuit pressure
Meanwhile, this is coming at a time when Circle is facing a class-action lawsuit in the United States over its handling of funds linked to the Drift Protocol exploit, where users reportedly lost around $280 million.
Out of this, about $230 million in USDC is said to be involved in the dispute. The main claim is that Circle had the power and technical ability to freeze the stolen USDC but did not take action.
The case was brought on behalf of affected users by law firm Gibbs Mura, with Joshua McCollum listed as lead plaintiff.
Circle defends its actions in public response
However, Circle’s CEO Jeremy Allaire responded to the situation by defending the company. He said Circle did not freeze the funds because there was no official order from law enforcement. He also explained that intervening without formal orders could create legal complications.
In his words, “If there are others that believe that Circle should just step away from what the law says and do its own decisions, I think it’s a very risky proposition.”
ARK Invest also reduced its position in another crypto-linked company, Bullish (NYSE: BLSH), selling 31,417 shares worth about $1.36 million on the same day. These trades stood out because ARK had very low trading activity earlier in the week, with no major moves on April 14 and April 15.
Stock reacts as market stays cautious
At the same time, Circle’s stock is showing signs of struggle. On April 17, CRCL fell 1.44% and closed at $105.91 as the week ended, followed by a further 0.91% decline in after-hours trading to around $104.95.
The movement came shortly after a brief upward push in the previous session, when the stock gained 1.84% to close at $107.46.
Broader Context
Circle Internet Group is the company behind USDC, one of the biggest stablecoins in the crypto world. USDC is second only to Tether’s USDT and has a market value of about $78.63 billion.
But, this Drift Protocol hack has created debate in the crypto industry about what stablecoin companies should do during attacks. One side believes companies should freeze stolen funds when possible. The other side believes they should only act when there is a legal order. This case has now moved into court, making it a bigger issue for the industry.
ARK Invest’s decision to sell part of its Circle shares shows that investors are becoming more careful during this period of legal pressure and market uncertainty. The situation is still developing as the lawsuit continues.
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