TikTok Lite's cash rewards draw nearly 8 million users in Korea as regulators stand idle

The EU moved to rein in TikTok's cash reward events over concerns about youth addiction, but critics say South Korea's Korea Communications Commission — the agency responsible for overseeing the platform — has yet to take any action.

The cash reward program was shut down in Europe following addiction concerns among young users. TikTok Korea, however, continues to aggressively recruit users with cash incentives of up to 600,000 won ($420), and TikTok Lite app users in South Korea have surpassed 8 million without any regulatory intervention from the commission.

According to industry sources Wednesday, TikTok Lite — launched in December 2023 — has seen explosive growth, with its monthly active users (MAU) approaching 8 million based on data from Mobile Index. New installations have consistently hovered around 500,000 over the past year, and in January this year the figure nearly reached 2 million.

The cash reward events have been a key driver of that growth. Running continuously since the app's domestic launch under various names — including "Drum Roll," "Popcorn Bang Bang" and "Night Market Under the Moon" — the promotions encourage users to invite friends to sign up, then reward participants with up to 600,000 won depending on their level of engagement. The events have proven popular among users, including teenagers.

TikTok Korea has described the cash reward events as "designed to attract new users and encourage existing users to engage more within the app."

In April 2024, the EU launched an investigation into whether TikTok's cash reward events and other practices violated the Digital Services Act (DSA), citing concerns about youth addiction. As the probe intensified, TikTok suspended the cash reward events that same month and ultimately shut the program down entirely.

Margrethe Vestager, then executive vice president of the European Commission, said at the time that the EU had made TikTok's commitments under the DSA "legally binding" and that it would "carefully monitor TikTok's compliance."

The central concern is that TikTok Korea's cash reward events continue unchecked while the Korea Communications Commission has yet to put any countermeasures in place. The events have drawn repeated criticism over the years.

During the 2024 national audit, Rep. Lee Sang-hwi, then a member of the Science, ICT, Broadcasting and Communications Committee, said the events — which pay out more cash the more friends a user recruits — amounted to "a de facto pyramid scheme in SNS form," and called for sanctions on SNS cash reward programs similar to the permanent ban imposed by the EU.

The Korea Communications Commission has said it lacks the legal basis to sanction TikTok Korea.

The commission acknowledged that "there have been concerns about minors exploiting TikTok Lite's cash reward events as a money-making tool," but said "there is no legal basis to prohibit it under the Act on Promotion of Information and Communications Network Utilization and Information Protection, the Telecommunications Business Act, or other relevant laws."

The commission added that it is "urging TikTok Korea to strengthen youth protection measures to prevent minors from exploiting the events as a source of income — whether by signing up under a parent's or acquaintance's name, or by inducing others to join."