Google Play Clarifies Wallet Policy After Developer Backlash

Google has moved to calm concerns among cryptocurrency developers after its new Play Store policy appeared to impose sweeping licensing requirements on all crypto wallet apps - including non-custodial ones.

The company has now clarified that non-custodial wallets were not intended to be covered by the rule and that the policy will be updated to reflect this.

The initial rollout of the policy drew strong criticism for applying the same compliance obligations to both custodial and non-custodial wallet providers. Under the original wording, developers in 15 jurisdictions – including the United States and European Union – were told they would need to meet local licensing standards before publishing wallet apps on the Play Store.

For U.S. developers, that meant registering with FinCEN as a Money Services Business and also securing state-level money transmitter licenses or a federal or state bank charter. Such requirements typically come with extensive Anti-Money Laundering (AML), Counter Terrorist Financing (CTF), and Know Your Customer (KYC) programs. While these rules are designed for custodial services that handle user funds, FinCEN’s own 2019 guidance makes clear that “unhosted” wallets are not classified as money transmitters.

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Industry advocates warned that enforcing these rules on non-custodial apps would have priced many developers out of the Play Store, slowed open-source wallet innovation, and forced unnecessary AML/KYC processes onto tools that never actually control customer assets. Critics pointed to a recent case involving Samourai Wallet, where court filings showed FinCEN had advised that the app’s developers likely did not require an MSB license – evidence prosecutors in the Southern District of New York allegedly failed to disclose.

The policy also raised concerns in Europe, where Google initially required wallet developers to be authorized as crypto-asset service providers (CASPs) under the EU’s Markets in Crypto-Assets (MiCA) regulation, and to comply with any extra national-level rules. Developers argued this could amount to a de facto ban on many non-custodial wallets in the region.

With Google now pledging to correct the language, developers hope the revised policy will preserve user access to non-custodial wallets while maintaining compliance standards for custodial services.