Legal & Privacy

The following list of risks associated with USDC and the USDC Services is not exhaustive.

No guarantee of price stability

Subject to the limitations set forth in this User Agreement, (i) when Circle tokenizes U.S. Dollars for USDC it will always do so at a rate of one U.S. Dollar ($1) per one (1) USDC and (ii) when Circle redeems USDC for U.S. Dollars, it will always redeem such USDC at a rate of one U.S. Dollar ($1) per one (1) USDC, less fees where applicable.

For each USDC that is issued by Circle and remains in circulation, Circle will maintain at least the equivalent of US denominated assets in segregated accounts with US regulated financial institutions on behalf of the USDC holders.  Each USDC is worth $1.00, and is always redeemable by Circle on a 1:1 basis for US dollars.  Circle does not guarantee that the value of one (1) USDC will always equal one U.S. Dollar ($1) across all platforms.  Due to a variety of factors outside of Circle’s control, the value of USDC, particularly on third-party platforms such as cryptocurrency exchange platforms, can fluctuate above or below one U.S. Dollar ($1). Circle cannot control how third parties value USDC, and Circle is not responsible for any losses or other issues that may result from fluctuations in the value of USDC.

Third-party platforms

USDC is based on open source software and runs on the Ethereum blockchain. This means that third parties can elect to support USDC on their platforms without any authorization or approval by Circle or anyone else.  As a result, USDC support on any third-party platform does not imply any endorsement by Circle that such third-party services are valid, legal, stable or otherwise appropriate. Circle is not responsible for any losses or other issues you might encounter using USDC on non-Circle platforms.

Users accept all consequences of sending USDC off of Circle’s platform. USDC transactions are not reversible. Once you send USDC to an address, you accept the risk that you may lose access to, and any claim on, that USDC indefinitely or permanently. For example, (i) an address may have been entered incorrectly and the true owner of the address may never be discovered, (ii) you may not have (or subsequently lose) the private key associated with such address, (iii) an address may belong to an entity that will not return the USDC, (iv) an address belongs to an entity that may return the USDC but first requires action on your part, such as verification of your identity. For the avoidance of doubt, nothing in this Agreement is intended to obligate Circle to track, verify or determine the provenance of USDC balances for Users, including any form of security interests claimed thereon.

Blocked Addresses & Forfeited Funds

Circle reserves the right to “block” certain USDC addresses and, if such addresses are Circle custodied addresses, freeze associated USDC (temporarily or permanently) that it determines, in its sole discretion, are associated with illegal activity or activity that otherwise violates the terms of this User Agreement (“Blocked Addresses”). In the event that you send USDC to a Blocked Address, or receive USDC from a Blocked Address, Circle may freeze such USDC and take steps to terminate your USDC Account. In certain circumstances, Circle may deem it necessary to report such suspected illegal activity to applicable law enforcement agencies and you may forfeit any rights associated with your USDC, including the ability to redeem USDC for U.S. Dollars. Circle may also be forced to freeze USDC and/or surrender associated U.S. Dollars held in Segregated Accounts in the event it receives a legal order from a valid government authority requiring it to do so.

Blacklisting

USDC is issued and redeemed in accordance with Circle's blacklisting policy. Circle reserves the right to block the transfer of USDC to and from an address on chain in extraordinary circumstances exclusively per the terms of the blacklisting policy.

Software protocols and operational challenges

You are aware of and accept the risk of operational challenges. Circle may experience sophisticated cyber-attacks, unexpected surges in activity or other operational or technical difficulties that may cause interruptions to the USDC Services. You understand that the USDC Services may experience operational issues that lead to delays, including delays in redeeming USDC. You agree to accept the risk of transaction failure resulting from unanticipated or heightened technical difficulties, including those resulting from sophisticated attacks. You agree not to hold Circle accountable for any related losses.

Compliance

You are responsible for complying with applicable law. You agree that Circle is not responsible for determining whether or which laws may apply to your transactions, including tax laws. You are solely responsible for reporting and paying any taxes arising from your use of the USDC Services, including any accurate reporting of the tax or legal status of USDC in your jurisdiction.

Legislative and regulatory changes

Legislative and regulatory changes or actions at the U.S. state, U.S. federal, or international level may adversely affect the tokenization of U.S. Dollars into USDC, and the use, transfer, redemption and/or value of USDC.

No deposit insurance

USDC held in your USDC Account are not subject to deposit insurance protection, including, but not limited to, (i) where your country of residence is the United States, the Federal Deposit Insurance Corporation insurance or Securities Investor Protection Corporation protections; or (ii) where your country of residence is outside of the United States, the United Kingdom Financial Services Compensation Scheme or equivalent scheme in your country of residence.

Claim on funds

Circle holds the equivalent value of one U.S. Dollar ($1) in Segregated Accounts, on behalf of, and for the benefit of, Users for each USDC that is issued by Circle and remains in circulation. Your ability to redeem a U.S. Dollar for each USDC is conditional on (i) your possession of a corresponding amount of USDC associated with a registered USDC Account, (ii) no violation of this User Agreement, and (iii) no action, pending or otherwise, by a regulator, law enforcement or a court of competent jurisdiction that would restrict redemption.

Sending USDC to another address automatically transfers and assigns to that Holder, and any subsequent Holder, the right to redeem USDC for US Dollar funds so long as the Holder is eligible to, and does, register a USDC Account.

Legal treatment of USDC transfers

The regulatory status of USDC and blockchain technology is unclear or unsettled in many jurisdictions. It is difficult to predict how or whether regulatory agencies may apply existing regulation with respect to USDC, blockchain technology and its applications. Accordingly, it is not possible to determine whether a USDC transfer would be recognized under applicable law by a court or regulator at the U.S. state, U.S. federal, or international level.

Encumbrances

Depending on the actions of the owners of USDC addresses before your receipt of USDC from another USDC address, it is possible that the transfer of USDC between USDC addresses could result in the USDC in your USDC Account becoming subject to a lien or other form of security interest before redemption.

On-chain transactions irreversible

When USDC is sent out of your USDC Account to a third-party USDC address, such transaction is completed on the Ethereum blockchain. This means that such transaction is irreversible and Circle does not have the ability to reverse or recall any transaction once initiated.  You bear all responsibility for any losses that might be incurred as a result of sending USDC to an incorrect or unintended USDC address.