At least one firearms trade group in the US rejoiced this week after Circle updated its terms of service to allow the legal purchase of guns using its stablecoin, USDC ($1.00).

Circle, the crypto industry’s second-largest stablecoin issuer, previously categorised the purchase of “weapons of any kind, including but not limited to firearms, ammunition, knives, explosives, or related accessories,” as a prohibited purchase, according to digital archives.

The company said it reserved the right to block such transactions.

Now, those terms were updated in November to specify that only weapons purchased in “contravention of applicable laws” would be banned.

The Firearm Industry Trade Association, or NSSF, is chalking up the revision as a key win for gun rights in the US.

“Freedom cannot survive if your financial tools are turned against you and your Second Amendment rights,” the group said on Tuesday, referring to the constitutional right to bear arms.

Neither Circle nor the NSSF immediately responded to requests for comment.

Stablecoins go mainstream

Since the election of US President Donald Trump, the crypto industry has experienced a surge in asset prices and deeper integration with traditional financial markets thanks to the administration’s favourable approach to digital assets.

Stablecoin providers, including Circle, have also emerged as some of the biggest winners.

Circle is the issuer of USDC, which has a market capitalisation of $76 billion as of November, according to CoinGecko.

In June, the company raised over $1 billion through its initial public offering on the New York Stock Exchange.

A month later, Trump signed landmark stablecoin legislation that legally defined what entities can issue digital dollars in the US and under what circumstances, catapulting issuers into the mainstream.

Since then, several banks, financial institutions, and fintech players, including Bank of America, Morgan Stanley, and Robinhood, have poured into the space with their own stablecoin offerings.

The new attention to the digital assets industry, however, has also led to criticism that crypto companies are following in the footsteps of other large banks.

Operation chokepoint

The NSSF couched Circle’s ban on purchasing weapons with USDC as another example of discriminatory banking practices.

“This type of blatant financial discrimination is not the least related to ‘public safety,’ but more so an ideological anti-gun political posture that penalises law-abiding Americans,” the trade group said, referring to Circle’s ban on purchasing firearms with USDC.

The NSSF argued that the clause in Circle’s terms also contradicted Trump’s executive order in August to curb banking practices that assessed clients according to their political orientation.

Liam Kelly is DL News’ Berlin-based DeFi correspondent. Have a tip? Get in touch at liam@dlnews.com.