ZachXBT criticizes RLUSD and Circle
ZachXBT accuses Circle of ignoring North Korean misuse of USDC stablecoin
On-chain analyst ZachXBT has raised serious concerns regarding the misuse of Circle’s USDC stablecoin by North Korean IT operatives.
According to ZachXBT, tens of millions of dollars have flowed through USDC without sufficient intervention from Circle, despite its public claims of compliance and oversight, reports Cryptopolitan.
He accused the company of ignoring these illicit transactions and labeled the situation as part of a growing “crime super cycle” in the crypto space. The issue gains more relevance as Circle recently applied to establish a national trust bank in the U.S. to manage its reserves following a successful IPO that valued the company at around $18 billion. The potential regulatory scrutiny from this bank application could further complicate Circle’s response to these allegations, putting additional pressure on the company’s risk management and compliance practices.
ZachXBT calls out Ripple’s RLUSD for artificial adoption
As some XRP community members pointed to Ripple’s RLUSD as a safer stablecoin alternative, ZachXBT sharply criticized Ripple’s adoption strategies. He argued that unlike Circle, Paxos, or Tether, Ripple’s stablecoin lacks a genuine user base and instead relies on paid partnerships that are often misrepresented as organic growth. ZachXBT emphasized that while USDC may have compliance gaps, it still serves a large, organic ecosystem, whereas RLUSD is “artificially inflated.”
He also reiterated his lack of trust in Ripple’s promotional tactics, despite acknowledging that RLUSD is backed by real assets. The conversation further intensified Ripple’s ongoing credibility issues, especially as the company continues to face skepticism following its partial legal victory over the U.S. Securities and Exchange Commission (SEC).
Stablecoin market sees rapid expansion as scrutiny grows
The debate surrounding Circle and Ripple comes at a time when the stablecoin market is rapidly expanding, with the total market cap surpassing $263 billion and daily trading volumes exceeding $62.4 billion. Tether’s USDT leads the stablecoin space with a market cap of over $157 billion, followed by Circle’s USDC at more than $61 billion.
Ripple’s RLUSD is still in its early stages, with a much smaller market cap of $455 million, though XRP’s recent legal victories have sparked renewed investor interest. Meanwhile, Circle’s stock (CRCL) has faced significant selling pressure, plunging 28% over the past week, raising further questions about investor confidence amid regulatory uncertainty. As geopolitical tensions, regulatory actions, and competition among stablecoin issuers intensify, the scrutiny on both established players like Circle and emerging entrants like Ripple is expected to grow in the coming months.
Recently we wrote that Ripple has entered into a strategic partnership with Web3 payments platform AEON to enable crypto payments via XRP and Ripple USD (RLUSD) across more than 20 million merchants globally.
