Apple may soon allow users to install iOS apps from external sources, thanks to new EU regulations. By doing so, the tech giant would also open up its ecosystem to the benefit of crypto and NFTs. 

Apple and the installation of new external apps to open up to crypto and NFTs

Apple is reportedly planning to allow iOS apps to be installed from external sources, thanks to new EU regulations. If so, developers could build apps for NFTs and expand the ability to make crypto payments through iPhones and iPads. 

New story: Apple is preparing to allow alternative app stores and side-loading on iOS — along with a slew of other changes to make the iPhone more open — in response to new European Union requirements arriving in 2024. https://t.co/hZpXrKdHGj

— Mark Gurman (@markgurman) December 13, 2022

Specifically, Apple has reportedly decided to open up its ecosystem due to the European Union’s Digital Markets Act, which requires tech companies to fully comply with restrictions by 2024.

The tech giant’s new changes would begin in Europe and then expand to other territories where similar regulations exist. Not only that, the timing of the introduction of such features may come along with the iOS 17 software update, which is expected to be launched next fall according to the typical annual release schedule.

The ability to install third-party apps could also involve the inclusion of a payment infrastructure other than Apple’s traditional one. That is why it will soon be revealed whether cryptocurrencies can also be used through the tech giant, something that is currently unthinkable. 

Apple and the current 30% fee on NFT transactions

Indeed, it has been since last September that Apple introduced the possibility for developers to sell their NFTs through its App Store, within games and apps. However, the tech giant itself has forced such developers to pay a 30% fee on every NFT transaction.  

This is why we speak of a closed ecosystem when referring to Apple. It is likely that the tech giant wanted to experiment with the Non-Fungible Token sector, albeit keeping its strict rules, to the detriment of what is implied by Web3 and decentralization. 

And in fact, many startups accused Apple of taking advantage of its market dominance, claiming that it was impossible for them to pay such fees just to use the App Store. 

Hence, to meet the needs of its developer customers, Apple has since reduced the commission to 15% only for companies billing under $1 million. 

Of course, those remain exorbitant figures when considering that the average transaction cost is around 2% and 3% in fees. And indeed, on Apple devices, companies such as OpenSea and Magic Eden marketplaces only allow users to browse NFTs, not buy or sell them through the app.

Even Coinbase discontinues its NFT functionality on Apple devices

In October, the group of startups refusing to pay fees on NFTs in the Apple ecosystem was joined by Coinbase Wallet iOS, which, in an update to the app, disabled the NFT functionality. 

This happened precisely because it is impossible to meet Apple’s demands, even from one of the most popular names in the crypto world. 

And indeed, one of the alternative solutions for Coinbase Wallet iOS users is to move their NFTs to the decentralized wallets of MetaMask or Trust Wallet. 

In this way, Coinbase is again aligning itself with what is the essential workings of NFTs and blockchain, moving away from Apple’s closed ecosystem. 

General complaints about Apple’s policies

The news of Apple’s 30% fees has stirred up a real cauldron among major players in the crypto and non-crypto worlds, who have publicly denounced such a policy of the tech giant. 

And indeed, Dan Finlay, co-founder of MetaMask and a former Apple employee, had tweeted the following:

Oh I’ll absolutely stand in solidarity here, I assume MM and every other wallet is next. I’m ready to dump the Apple ecosystem. The 30% tax is an abuse of monopoly. @tim_cook has donned the Big Brother screen. https://t.co/tzcA0Ol658

— Dan Finlay (@danfinlay) December 1, 2022

In addition, the new owner of Twitter, Elon Musk, also complained on his social network. Here is the tweet:

Did you know Apple puts a secret 30% tax on everything you buy through their App Store? https://t.co/LGkPZ4EYcz

— Elon Musk (@elonmusk) November 28, 2022

Musk recently outlined his new plans for doing business with Twitter, with the goal of making the social network “an app for everything,” including crypto.

The Coinbase Wallet app update disables the NFT feature at Apple‘s request, so users of the platform get caught up in Apple’s in-app purchase problems. 

In addition, it appears that the operating system giant has asked Coinbase to pay a 30% fee on gas used to transfer NFT in-app, according to Watcher.Guru‘s Twitter account: 

JUST IN: Apple blocks #Coinbase Wallet app release, requesting 30% of all NFT transfer gas fees.

— Watcher.Guru (@WatcherGuru) December 1, 2022

Coinbase stresses: impossible to meet Apple’s demand 

Following the controversy stirred up by Apple, Coinbase Wallet sent out an app update that discontinues NFT functionality. This is because Apple has disabled the feature until NFT gas fees can be paid through its in-app purchase system. 

The official Coinbase Wallet Twitter account reads: 

You might have noticed you can’t send NFTs on Coinbase Wallet iOS anymore. This is because Apple blocked our last app release until we disabled the feature.

— Coinbase Wallet (@CoinbaseWallet) December 1, 2022

This could prevent users from transferring non-fungible tokens to other wallets or giving them to friends or family members via Coinbase Wallet iOS.

As an alternative solution, Wallet users can import their recovery phrase into a non-iOS dApp wallet to regain access to NFT transfers, such as the Coinbase Wallet browser extension, MetaMask or Trust Wallet, keeping in mind all security practices. 

Moreover, Coinbase said that for anyone who understands how NFTs and blockchain work, Apple’s request is impossible:

“Apple’s proprietary in-app purchase system doesn’t support cryptocurrencies, so we couldn’t adjust even if we tried.”

Coinbase also said that the request made by Apple is similar to when the company sought a reduction in fees for each email sent through open Internet protocols. 

One of the biggest problems with this move by Apple is that iOS users who hold their NFTs in an iPhone wallet have to go through a lengthy process to transfer the NFTs.

In this regard, Coinbase stated: 

“Simply put, Apple introduced new policies to protect its bottom line at the expense of consumer investment in NFTs and developer innovation in the crypto ecosystem.”

Coinbase Wallet says it is willing to help Apple overcome what it hopes is an oversight on behalf of the company, which is protecting its profits at the expense of consumers and developers.

The action will surely affect an entire sector of iOS users who keep their NFTs in their iPhone wallets. It is unclear whether the decision will be overturned or affect the entire ecosystem.

This is not a first for Apple: before Coinbase there was the dispute with Fortnite by Epic Games

Before the dispute with Coinbase, Apple had to face another one with the publisher of Fortnite Epic Games, which sued Apple in 2020 for not allowing it to use its payment platform instead of in-app purchases through the App Store.

Appeals in the Epic Games vs Apple App Store lawsuit officially began a few weeks ago, continuing the high-stakes legal dispute in what could be a years-long trial.

Indeed, within a few weeks, a disagreement between Epic Games’ ambitions and Apple’s intention to maintain the status quo of the App Store has courted quite a bit of controversy. 

The affair began with consumer warnings, but quickly attracted international interest as the battle sought to change one of the core elements of the App Store: how much Apple makes.

Apple’s dominance has previously led to an antitrust investigation by the US Department of Justice into App Store fees and policies. However, the disagreement between Apple and Epic is being made more public and directly affects younger customers.

Although the fight is primarily between Epic Games and Apple, it has already seen other parties come in with their own comments and opinions on the matter, including developers of other apps included in the App Store.

Further backlash for Coinbase: the exchange’s difficulties after FTX 

Coinbase’s problem with Apple comes at a difficult time for the cryptocurrency exchange, whose shares are down about 80% so far this year. In addition, the company has also found itself forced to cut jobs to manage expenses as investors are losing interest in cryptocurrencies.

NFTs, on the other hand, which are digital assets that exist on the blockchain and carry unique digital signatures, exploded in popularity in 2021, but have seen demand crippled by the cryptocurrency winter in recent months.

Cryptocurrencies have been rattled by higher interest rates and concerns of an economic recession forcing investors to offload risky assets with the recent collapse of rival exchange FTX also piling pressure on the sector.

However, despite the current difficulties in the crypto world, Coinbase CEO Brian Armstrong had previously reassured his users that his company had no material exposure to FTX or Alameda. 

In addition, Coinbase’s Armstrong had previously been quick to emphasize the exchange’s strength, stating: 

“I think it’s important to reinforce what differentiates Coinbase at a time like this. This event appears to be the result of risky business practices, including conflicts of interest between deeply intertwined entities and misuse of client funds.”

In fact, according to Armstrong, Coinbase is staying very far away from these kinds of risky situations and behaviors, and also reassures that the platform does not use customer funds in any way, unless expressly directed by it, and that customers can withdraw their funds at any time.

The Cupertino-based giant, Apple, has decided to allow the sale of NFTs through its App Store.

The sale of NFTs on Apple’s store

In an announcement that was long overdue, Apple has let it be known that it will allow developers to sell their NFTs through its app store, within games and apps, although this has raised some eyebrows in the crypto community.

Apple has decided to let developers sell NFTs inside of games/apps. Everyone is focusing on apple wanting its 30% cut of each transaction without realizing this could put an ETH wallet in every single mobile game onboarding 1B+ players! https://t.co/BPJj3gD5r2

— Gabriel Leydon (FREE,OWN) (@gabrielleydon) September 23, 2022

Now, developers of current apps can sell NFTs within apps, and new apps can have NFTs within them. However, as pointed out by some, attention is being drawn to the hefty 30% fee of each NFT transaction by Apple. Evidently, the boom that the NFT market enjoyed last year has also attracted a giant like Apple, which has evidently decided to jump into this interesting market to do further business, taking advantage of its dominant position in the app market, thanks to its App store.

For this very reason, many start-ups seem to be not at all interested in using the App store, while according to the company, there have already been many requests from developers and start-ups. Several start-ups complain that the rules Apple allegedly imposed on them and the 30% fees make it impossible to use the App store. 

Apple has been trying to run for cover by reducing the fee to 15% for companies billing under $1 million, but the response from companies in the industry continues to remain very weak. It is enough to consider that the average transaction cost is around 2-3%. 

However, it is not only the high fees that are driving developers away from the App Store, but also other rules, such as that transactions must be made in dollars or other currencies, and not cryptocurrencies.

At Apple’s release of this announcement, Arthur Sabintsev of the blockchain company Pocket Network, said that this problem

“makes it really hard to price it because you have to program all these values in dynamically.”

As a result, Sabintsev said he advised one of his clients to allow users to purchase currency in-app:

“In the same way that some games do. They buy the currency, and that transaction nets Apple 30%, then they spend it in-app on deals.”

Apple’s uncertain goals

Apple would also require all developers who released games with NFTs to transfer it only as in-app purchases. A rule that undermines the principle of disintermediation typical of blockchain-based crypto assets, which can be transferred freely between crypto wallets without the need for third-party oversight. In that case, NFTs are sold peer-to-peer without additional fees except for “gas fees” or a “sales fee” imposed by the game itself.

For some, all these rules make it seem that there is little real interest on Apple’s part to develop this NFT sector, which has slowed down sharply in early 2022 in the wake of major declines in the cryptocurrency market. 

Alexei Falin, CEO of the well-known NFT platform Rarible, said:

“It seems that the position is that Apple doesn’t really want users [of the App Store] to be able to buy or sell NFTs. It’s almost impossible because these are fixed subscriptions or fixed prices.”

Falin also argued how it took several months to get Rarible’s app on the App store, versus only a few days for Google Play Store. Apple’s App Store currently already hosts 3.59 million apps and 984,000 games.

While Apple seems to be adopting a basically restrictive policy toward all things related to NFTs, other giants on the other hand, seem to want to move decisively towards NFTs, especially in light of the new developments that could occur with Web3 and the Metaverse.

Disney wants to develop its metaverse idea

In recent days, the company posted a job ad on LinkedIn seeking a lawyer specializing in digital asset transactions with a focus on the world of NFTs to explore new technological opportunities.

The job ad reads:

“Participate with business teams as they plan new global emerging technology projects across supplementary segments, such as the metaverse and decentralized finance.

Assist in performing due diligence for NFT, blockchain, third party marketplace and cloud provider projects, and negotiating and drafting complex agreements for those projects.”

Then again, the company’s CEO, Bob Chapek, has repeatedly stated, most recently on 10 September, that Disney is ready to explore the new frontier of the metaverse:

“We call it next-generation storytelling. We don’t use the Metaverse word too often because it has so much hair in it.”

In February, Disney hired a Business Development manager with a specific focus on the NFT world. The former Disney CEO had said months ago that he had been amazed at how many Disney items in NFTs he had found on the OpenSea platform, most of which were without the rights to create them, thus pirated.

In February, the company released the first four NFT collections, under the name “Golden Moments,” one for each of Disney’s franchises: Pixar, Star Wars, Marvel, and animation studio. The collections sold out within hours on the Veve platform, which handled the sales.

The NFT industry has already taken the fashion world by storm, with major brands from Gucci to Prada to Richmond, Cartier Hublot and Nike already launching unique NFT collections in recent months.

In August, coffee giant Starbucks launched its NFT reward program, while the sports world is finding precisely in NFTs a new way to expand its business, thanks to new possibilities for interaction with its fans.