Circle, the issuer of the USDC stablecoin, has reversed its earlier policy restricting the use of its token for firearm purchases — a decision that has stirred political debate over financial freedom and the neutrality of stablecoins. The update follows pressure from U.S. gun rights advocates and lawmakers who accused the company of discriminating against lawful transactions protected under the Second Amendment.
The National Shooting Sports Foundation (NSSF), a trade group representing gun manufacturers and retailers, confirmed that Circle has amended its terms of service to allow the use of USDC for legal firearm sales. “Circle has clarified our Terms to reflect that USDC may be used for the lawful purchase and sale of firearms, as protected under the Second Amendment,” a company spokesperson told the NSSF. “We have not and will not deny the use of USDC for legally permissible transactions involving firearms.”
The move came after criticism from Americans for Tax Reform (ATR), which revealed that Circle had previously restricted USDC transactions linked to “weapons of any kind,” including guns and ammunition. ATR questioned whether private financial companies should decide what constitutes a legitimate purchase, suggesting that the restriction reflected political bias. The report also pointed out Circle CEO Jeremy Allaire’s campaign donations to Representative Jake Auchincloss, a Democrat known for supporting gun control measures.
Republican lawmakers quickly framed Circle’s reversal as a win against what they called financial “weaponisation.” Senator Bill Hagerty (R-TN), who co-authored the GENIUS Act — the stablecoin legislation signed into law by President Donald Trump earlier this year — hailed the change as “a reversal of Choke Point-inspired mechanisms to sidestep the legislative process and achieve partisan goals.” Senator Cynthia Lummis (R-WY) echoed his sentiment, tweeting that Circle’s updated policy “defends constitutional rights and ensures financial systems can’t be weaponised against law-abiding gun owners.”
Yet, not all reactions were celebratory. Some industry observers warned that the reversal highlights how centralised stablecoins remain susceptible to political influence. Komodo CTO Kadan Stadelmann told Decrypt that the episode shows “stablecoins are at the whims of politicians.” He added that because issuers like Circle operate under U.S. jurisdiction, they are “beholden to domestic agendas,” leaving users vulnerable to censorship and government pressure.
The debate underscores an ongoing tension between the ideals of financial neutrality in crypto and the regulatory realities faced by companies operating within traditional legal systems. While Circle’s update has been welcomed by advocates of financial and constitutional freedom, it has also reignited questions about whether any stablecoin managed by a centralised entity can truly remain apolitical.
