Google Play will require crypto wallet apps to get licensed in the US, EU, and 13 more regions from October 29.
The new policy only applies to custodial wallets and does not affect non-custodial crypto wallet apps.
Developers must follow local laws and meet financial rules to keep their crypto apps on the Play Store.
Google Play has updated its policy to demand proper licensing needed by crypto wallet providers in more than 15 jurisdictions. This involves developers in the United States, United Kingdom, and European Union. The reforms will go into effect on October 29.
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Only custodial wallets fall under the scope of the new rules. Non-custodial wallets will remain unaffected. Google clarified this after confusion and backlash from parts of the crypto community.
Developers must comply with local financial regulations to keep their apps on the platform. Within the U.S. they must register as either money services businesses or money transmitters. Developers in the EU have to become crypto-asset service providers.
Stricter Compliance with Financial Regulations
The updated policy aligns Google Play with broader financial compliance standards. In the U.S., registration with FinCEN means implementing anti-money laundering (AML) measures. These may include Know Your Customer (KYC) protocols and written compliance programs.
This step may present further difficulties to app creators in regulated markets. It could also be an indication of a more strident regulatory control of crypto-based applications around the world. .
In the European Union, compliance involves registration under the Markets in Crypto-Assets (MiCA) framework. Developers must follow operational, security, and transparency requirements. The UK will likely see similar enforcement under local regulations.
Non-Custodial Wallets Remain Unaffected
After a public outcry, Google clarified, stating the non-custodial wallets are not affected by the policy change. The wallets enable a person to remain in possession of his/her own keys. Thus they are not custodial services under existing definitions.
The company plans to update its Help Center to avoid future confusion. It clarified that non-custodial apps will not be subject to removal. This confirmation was issued after the initial reporting created widespread misunderstanding in the crypto community.
History of Crypto App Restrictions on Google Play
Google Play has a mixed history with blockchain apps. In 2018, it banned cryptocurrency mining apps. By 2020, it had removed several crypto news apps without public explanation.
In 2021, the platform banned deceptive apps that posed as crypto services. Some of these allegedly tricked users into paying for fake cloud mining. In 2023, Google revised its NFT app rules, requiring disclosure of in-game token features. It also prohibited gambling features like loot boxes.
Currently, Google Play identifies four types of crypto-related apps for special scrutiny. These include exchanges, custodial wallets, token distribution apps, and NFT-based games.