"Google Play to block overseas exchanges and wallet apps, expected to have a significant impact on the industry"

An analysis says Google Play’s rollout of a policy restricting domestic distribution of overseas digital-asset exchanges and wallet applications will inevitably affect the broader digital-asset market.

On the 16th (Korea time), law firm Bae, Kim & Lee LLC said in a legal analysis report it published that “Google Play has formalized a policy that significantly tightens listing requirements for overseas virtual-asset exchange and wallet apps,” adding that “as a result, apps of overseas digital-asset operators that have not filed in Korea are expected to be restricted from use on Google Play Korea.”

The policy will take effect on the 28th. Accordingly, all overseas exchange and wallet apps—except domestic operators that have been reported to and accepted by the Korea Financial Intelligence Unit (FIU) as virtual asset service providers (VASPs)—are expected to face download restrictions. The download limits, previously confined to exchanges on a blacklist, will be expanded across the board.

Bae, Kim & Lee explained, “Users who have already installed the apps can continue using them for the time being, but new downloads and updates will be restricted, making longer-term constraints on service use unavoidable.”

However, the firm stressed that “this is part of a policy change by a private operator, Google Play,” and that “the inability to download apps domestically does not mean all transactions with overseas exchanges or wallet operators are prohibited.” It added, “Accessing overseas exchanges via their websites or installing apps through channels outside app stores remains possible,” and said that deposits and withdrawals with overseas exchanges not included on the FIU blacklist, as well as Travel Rule-based asset transfers, are expected to remain permitted as before.

It also raised the possibility that similar measures could be expanded going forward. Bae, Kim & Lee said, “This measure is an example of a global platform operator, Google Play, voluntarily stepping up regulatory compliance to reflect each country’s virtual-asset regulatory environment,” and analyzed that “such privately led regulatory responses are likely to spread to other global platforms in the future.”

The firm also urged, “Domestic users should be mindful that legal and practical responsibility may rest with them when using unreported overseas virtual-asset services.”