The United States has recently made strides in embracing cryptocurrencies, alleviating some of the intense pressure on the industry. However, this regulatory shift comes with a new set of mandatory standards. For example, the European Union is implementing licensing frameworks to ensure crypto companies cannot operate as freely without adhering to legal responsibilities, as highlighted by the recent actions of Google.
What Is Google’s New Strategy?
Google has announced significant changes for its Play Store, targeting crypto wallets. Specifically, the tech giant has decided to delist any crypto wallets without a FinCEN registration, a state banking license, or a MiCA license. This policy shift directly affects developers seeking to offer their services on the platform without meeting these compliance requirements.
How Will Non-Custodial Wallets Be Affected?
Non-custodial crypto wallets in the Play Store, particularly in the U.S., are now required to adhere to AML/KYC regulations. This amendment has already influenced market dynamics, such as a noticeable drop in Ethereum’s price by $70. In the EU, non-custodial wallets face even stricter bans due to MiCA’s licensing requirements, complicating operations for decentralized crypto applications.
“The developer must be registered as a Money Services Business with FinCEN and as a money transmitter in a state or be a federally or state-authorized banking institution.” – United States
“The developer must be authorized by the competent national authority under the Markets in Crypto-Assets (MiCA) regulation as a crypto asset service provider (CASP). Besides MiCA, all other local legal requirements, including national restrictions or requirements, must also be complied with.” – European Union
MiCA does not issue licenses to straightforward services like non-custodial wallets, restricting these apps from operating on the Play Store in the EU. As per FATF guidelines, even decentralized crypto applications need to comply with these AML rules.
In the upcoming days, it will become clearer which applications will face these new restrictions.
Concrete outcomes from this development include:
- Mandatory AML/KYC usage for certain crypto wallet services.
- A ban on non-custodial wallets without proper licensing in the EU.
- A significant drop in Ethereum’s market value observed.
- Wider implications under FATF guidelines.
As crypto regulations evolve, companies must adapt to these new legal frameworks to remain operational within the Play Store ecosystem. Keeping abreast of these developments is crucial for both the industry and consumers.
