Stablecoin issuer Circle has amended its terms of service to allow legal firearm purchases using its USD-backed stablecoin, USDC, reversing a previous policy that banned such transactions.
The change follows public backlash from gun rights organizations and pressure from groups such as the National Shooting Sports Foundation (NSSF) and Americans for Tax Reform (ATR).
Announced on November 5, the update modifies Circle’s Prohibited Transactions policy, which formerly barred the use of USDC for the purchase of “weapons of any kind.” Under the new clause, firearm transactions are permitted as long as they comply with applicable laws in the United States.
“Circle has always held that to the right of lawful, the use of money should be free,” the company said in a statement to NSSF. “This includes lawful purchases of firearms in the United States, which is a Second Amendment protected right.”
Political Reaction and Industry Response
The policy reversal quickly drew praise from U.S. Senator Cynthia Lummis, a long-time advocate for both cryptocurrency and constitutional rights.
“By aligning its terms of service with existing legal requirements, Circle defends constitutional rights and ensures financial systems can’t be weaponized against law-abiding gun owners,” said Lummis on X (formerly Twitter).
The NSSF, which had criticized Circle’s earlier policy, commended the company for reaffirming that payment tools should not undermine personal freedoms.
“Freedom can’t survive if your payment tools work against you,” the foundation wrote following the update.
Backlash Over Original Policy
Circle faced growing criticism in October after ATR revealed a section in the company’s terms that prohibited USDC use for weapon purchases. ATR’s post accused the firm of hypocrisy, referencing that Circle CEO Jeremy Allaire had made political donations to Democratic candidates, including those supporting gun control legislation.
The NSSF also weighed in, warning that the restriction posed a threat to Second Amendment rights and arguing that private companies should not dictate constitutionally protected activities.
The backlash ultimately pushed Circle to reassess and clarify its stance, emphasizing that its services are meant to be neutral financial infrastructure, not a tool for policy enforcement.
What the Updated Terms Say
Under Circle’s revised terms, the prohibited transactions clause now reads:
“Weapons of any kind in contravention of applicable laws, including but not limited to firearms, ammunition, knives, explosives, or related accessories.”
This means that only illegal or unlicensed firearm transactions remain restricted, aligning Circle’s terms with existing federal and state laws.
Beyond weapons-related clauses, Circle continues to ban the use of USDC for:
- Money laundering or terrorist financing
- Unauthorized gambling operations
- Ponzi or pyramid schemes
- Counterfeit goods and darknet marketplaces
- Market manipulation, including wash trading, front-running, and insider trading
The company reiterated that it reserves the right to monitor or block suspicious transactions, and that users found violating its terms may face suspension or termination of their Circle Mint accounts.
Balancing Compliance With Freedom
Circle’s policy change represents an effort to balance regulatory compliance with constitutional rights, particularly the Second Amendment, which guarantees Americans the right to keep and bear arms.
By clarifying its terms, Circle has aimed to reassure users that its stablecoin will not be used to enforce political agendas, while still maintaining oversight of illegal financial activities.
The move highlights the growing debate around financial freedom and digital currency governance, as blockchain-based payment systems increasingly intersect with political, legal, and social issues in the United States.
