• Key insight: A class action in Massachusetts argues Circle’s ability to freeze tokens at any wallet address creates a higher anti-money-laundering duty than banks face under the Bank Secrecy Act.
• What’s at stake: If regulators side with Tether’s approach, banks issuing or partnering on stablecoins could face an obligation to freeze customer funds in real time, a duty no traditional bank has.
• Expert quote: Columbia Business School adjunct professor Omid Malekan defended Circle’s restraint, writing that if issuers freeze beyond what the law requires, “not only is code not law, but also law is not law.”

Overview bullets generated by AI with editorial review

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