Apple’s absurd new crypto rules expose how out-of-touch it’s become
The rules, which include enormous fees for cryptocurrency users, set the company up for a fight it will be unable to win.
Giant companies like Apple have made a fortune by centralizing their powers and profits and expanding their product and services network to be a part of people’s lives in as many ways as they can. Until recently, however, Apple had also demonstrated an ability to tunnel-focus its efforts to stay relevant and up to date with what consumers wanted, what mattered to them and what they needed most from the tech giants they rely on. It seems that this is not strictly true anymore, and that is a real shame.
In its updated App Store guidelines unveiled on Oct. 24, Apple announced that crypto exchange applications “may facilitate transactions or transmissions of cryptocurrency on an approved exchange” only “in countries or regions where the app has appropriate licensing and permissions to provide a cryptocurrency exchange.”
Additionally, any further payments needed to unlock extra features will need to be made with “in-app purchase currencies,” as developer apps “may not use their own mechanisms to unlock content or functionality, such as license keys, augmented reality markers, QR codes, cryptocurrencies and cryptocurrency wallets.”
This is aimed at ensuring “a safe experience for users” and a chance for developers “to be successful,” Apple claims, but I disagree. It’s clear to see that this is just another clever trick Apple is using to keep all the profits it can make; a particularly interesting move, as it pertains to nonfungible token (NFT) technology and Web3 games, which are soaring in popularity.
In a classic Apple move, the tech giant is attempting to control the “walled garden” it has spent decades building around its technology to prevent being challenged “over what software can land on its iPhones and Macs and what that software can do.”
But, cracks in the iron fence may be beginning to show.
Apple has been blocking various features in crypto apps for some time as well. https://t.co/4WGLAgS48i
— Brian Armstrong (@brian_armstrong) October 28, 2022
In May, the European Commission “charged Apple with abusing its payment dominance” in regard to Apple Pay practices, as it remains the only contactless option available for mobile payments on iPhone and iPad devices. And, as a 30% usage fee applies to any app utilizing the App Store’s in-app purchase function, Apple is no stranger to wanting to keep money in its ecosystem and take a cut out of everything that touches its prized flagship products.
But, when it comes to crypto technology and related Web3 products, they are decentralized, which means Apple would have no real way of taking a cut out of them.
To me, the updated App Store guidelines look like a desperate attempt at threatening competitors and protecting its monopoly. After all, some bigger cracks may be showing, and Apple might be more worried than it probably wants you to know.
As Cointelegraph recently reported, tech talent is migrating more and more to Web3 while tech giants like Apple, Google and Netflix undergo layoffs and hiring freezes. Data looking at the impact of the current economic downturn tells us that 700 tech startups have experienced layoffs within the last year, “impacting at least 93,519 employees globally,” in a move that resulted in an “overwhelming amount of talent flocking to early-stage Web3 companies.”
As Web3 looms, is Apple doomed? Of course not. Although it’s no longer the world’s most valuable company (Saudi Aramco overtook it in market capitalization in May), the iPhone maker is still a colossal presence in all of our daily lives — that is not going to change anytime soon.
What it might need to do, however, is re-think its stance on how it’s going to work with the technologies of the future. As angel investor Daniel Mason pointed out on Twitter, a main takeaway from the updated App Store guidelines is Apple “demonstrating a desire to work with crypto apps (especially games) but on its terms,” which is an extremely Apple-like position.
Today, Apple released new rules for crypto apps (especially web3 games) in the App Store.
Apple’s stance on NFTs, crypto, and payments will have a massive effect on the industry.
A featuring critical points, my takeaways, and winners/losers based on initial reading:
— Daniel Mason (@dgmason) October 24, 2022
But, as long as it antagonizes major crypto and NFT exchanges like OpenSea and Magic Eden, payment ramps like Moonpay and “anyone trying to compete with them for either primary or secondary NFT purchases,” as it seems to be prepared to do, Apple may just be prolonging a fight that Web3 is destined to win.
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.