Google Play Store imposes crypto wallet licensing in 15 jurisdictions including U.S. and EU

Google Play Store has introduced new licensing requirements for cryptocurrency wallet applications in 15 jurisdictions, including the United States and the European Union. Under the updated policy, developers must obtain regulatory approvals before publishing these apps on the platform. The move aims to ensure compliance with local financial regulations and create a “safe and compliant ecosystem for users” [1]. The policy applies to both custodial and non-custodial wallets, imposing compliance burdens that many developers are unable to meet [1].

In the U.S., developers are required to register with FinCEN as a Money Services Business (MSB) or operate as federally or state-chartered banking entities. This registration involves adherence to strict Anti-Money Laundering (AML), Counter Terrorist Financing (CTF), and Know Your Customer (KYC) frameworks [1]. Industry experts have pointed out that the policy goes beyond existing legal obligations for non-custodial wallets. According to FinCEN’s 2019 guidance, non-custodial wallets are not classified as money transmitters under current regulations [1]. The added compliance costs, particularly for MSB registration, may effectively prevent most non-custodial wallet developers from launching on the Play Store [1].

The policy has drawn criticism from legal experts and industry stakeholders. Bill Hughes, a lawyer from Consensys, highlighted inconsistencies in the policy, noting that Google introduced the update on July 10 without clearly defining key terms such as “software wallet.” He emphasized that registering as an MSB is not a requirement for non-custodial wallets under FinCEN guidelines [1]. Hughes further criticized the policy for creating confusion and warned that Big Tech platforms like Google are increasingly shaping the regulatory landscape for cryptocurrencies [1].

Justin Slaughter, vice president of regulatory affairs at Paradigm, also expressed concerns about the policy, particularly given Google’s ongoing antitrust litigation. He called the move “draconian” and questioned the necessity of imposing federal licensing requirements on software developers. Slaughter referenced draft U.S. legislation that asserts “pure coding should not require a federal license” [1]. These criticisms highlight the tension between regulatory enforcement and technological innovation in the crypto space.

The updated Google Play Store policy reflects a broader shift toward stricter compliance in the digital asset sector. While the company states that cryptocurrency activities should be conducted through “certified services in regulated jurisdictions,” it remains unclear how these standards will affect the accessibility and development of non-custodial wallet applications. As the policy continues to unfold, developers and regulators alike will need to navigate its implications carefully [1].

Source: [1]Google Play Store bans crypto wallets in 15 jurisdictions, requires new licensing compliance (https://cryptoslate.com/google-play-store-bans-crypto-wallets-in-15-jurisdictions-requires-new-licensing-compliance/)