Circle Submits Comment Letters in Support of Combatting Illicit Finance

On June 9, Circle submitted comment letters in response to two significant rulemakings from the U.S. Department of the Treasury. The first responds to the Financial Crimes Enforcement Network’s (FinCEN) Notice of Proposed Rulemaking (NPRM) on Anti-Money Laundering and Countering the Financing of Terrorism Programs, which proposes a comprehensive modernization of the AML/CFT program framework applicable to all covered financial institutions. The second responds to the joint FinCEN and Office of Foreign Assets Control (OFAC) NPRM proposing AML/CFT and sanctions compliance program requirements specifically for Permitted Payment Stablecoin Issuers (PPSIs) under the GENIUS Act.

Taken together, these rulemakings will shape the compliance architecture for the stablecoin ecosystem for years to come. Circle supports both efforts — and has engaged substantively on both to ensure the final rules are workable, risk-calibrated, and consistent with how payment stablecoins actually function on public, permissionless blockchains.

Why this matters: Getting these rules right determines whether stablecoin issuers can build effective, technology-forward compliance programs — or whether they will be forced into frameworks designed for a different era of finance, with compliance burdens disconnected from actual risk.

Circle's submissions are grounded in the following core principles:

• Blockchain-native controls are credible — and often superior — AML/CFT tools. For a stablecoin issuer like Circle, “distribution channels” are blockchain networks, and the risk controls available in that environment — onchain transaction monitoring, smart contract-level address restrictions, transaction graph analytics, and public ledger transparency — can provide more comprehensive traceability than legacy payment systems. FinCEN should explicitly recognize these tools as relevant and credible when evaluating program effectiveness. 

• Financial inclusion and strong AML/CFT compliance are not in conflict. Circle urges FinCEN to state explicitly in both final rules that serving low-risk, historically underbanked populations does not constitute elevated AML/CFT risk. Payment stablecoins — including USDC — are increasingly the payment instrument of choice for cross-border remittances in Latin America, Africa, and Southeast Asia. A properly calibrated risk-based framework channels compliance resources toward genuine risks while keeping access open for the populations that need it most. We commend FinCEN for recognizing that financial inclusion is a standalone policy objective, and the final rules should reflect that.

• The benefits of modernization must extend to all covered institutions, not just banks. FinCEN’s AML/CFT Modernization NPRM introduces valuable concepts — including an outcomes-based effectiveness standard and an important distinction between “establishing” and “maintaining” a compliant program — but frames these improvements most explicitly around federally supervised banks. Money services businesses (MSBs), broker-dealers, and future PPSIs face the same enforcement risk and deserve the same clarity. This matters because a modernized framework that applies only to one class of institution is not truly modern.

• The non-second-guessing principle must be in binding rule text. FinCEN states it will not second-guess reasonable, well-documented, risk-based resource allocation decisions — one of the most important commitments in the proposed rule. We strongly encouraged FinCEN to confirm this in the final text; the value of risk-based compliance depends entirely on institutions actually being able to direct resources toward their highest risks.

Circle has invested heavily in building a compliance program that represents the leading edge of what is possible in this ecosystem, including advanced blockchain analytics, smart contract-level controls, and an enterprise AI Risk Management Framework. These rulemakings are an opportunity to enshrine Circle’s approach as the industry model.