PANews reported on May 30th that Rand, the founder of the Zama protocol, stated on the X platform that, with the assistance of on-chain detective ZachXBT, the root cause of the cUSDC contract freeze has been identified. The freeze was caused by a court order imposing restrictions on an address associated with the Overnight Finance hackers. This address had deposited approximately $12.5 million in USDC into the cUSDC contract, representing over 99% of the contract's funds, leading to the entire contract being frozen.

Rand emphasized that this freeze is unrelated to the protocol itself or privacy technology, and is not a sanction against Zama; it falls under a typical DeFi legal restriction scenario. The project adheres to compliance and privacy principles, avoiding confusion between the sender and receiver in transactions, and only hiding the balance and amount.

Zama is currently communicating with multiple parties to resolve the issue and has suspended cUSDC, cUSDT, and cWETH contracts. These contracts will be restored after the investigation and handling of the affected addresses are completed. A detailed review report will be released as soon as possible.