Coinbase asserted that Apple had compelled it to take away NFT transfers from its Wallet App.
Related: Understanding The Challenges And Solutions of NFT Insurance in 2022
After being forced to disable some of its features, Coinbase Wallet poked fun at the largest tech corporation in the world, Apple. The second-largest bitcoin exchange in the world found itself in trouble because its wallet service was unable to adhere to certain Apple standards.
Bulldozed by Apple: Coinbase Wallet Stops NFT Transfers
The world’s most trusted cryptocurrency exchange claims that Apple coerced it into removing non-fungible token transfers from its iOS Wallet app. It said on Twitter on Thursday that Apple “blocked our last app update until we removed the feature” because the iPhone manufacturer wants to receive a 30% cut of the blockchain costs associated with an NFT transfer through its in-app purchase mechanism.
For several reasons, including the fact that the largest technology company’s system doesn’t handle crypto payments, the best secure online platform for buying and selling crypto claims that it is difficult to make that happen.
Even though certain non-fungible token exchanges allow you to buy digital tokens using conventional fiat money like the US dollar, the fees the world’s most trusted cryptocurrency exchange is referring to are something else entirely. On blockchains like Ethereum, which many NFT initiatives use, every transaction will be subject to a fee that goes to pay the people who validate it. ETH and other cryptocurrencies are used to pay the fees. Even if you send someone an NFT for no charge, that still holds.
Apple’s claim is that the gas fees required to send NFTs need to be paid through their In-App Purchase system, so that they can collect 30% of the gas fee.— Coinbase Wallet (@CoinbaseWallet) December 1, 2022
Notably, neither best secure online platform for buying and selling crypto nor the recipient of the non-fungible tokens receives any portion of the gas fee. The cost varies constantly depending on several variables, including the value of the cryptocurrency and the volume of transactions being validated. In other words, Apple’s in-app purchase system is not designed to manage this kind of situation.
This is due to multinational technology company In-App Purchase mechanism, which requires a 30% cut in gas costs. This taxing, which has been in place since the App Store’s establishment but went unreported for a time, was only recently brought to light by people like Elon Musk.
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
Despite this, it is not entirely surprising that a famous mobile phone manufacturing company informed the world’s most trusted cryptocurrency exchange that it could no longer use the non-fungible token transfer method as it had been. The organization revised section 3.1.1 of its App Store review policies in October to expressly address NFTs, as follows:
Applications may employ in-app purchases to sell non-fungible tokens (NFTs) and services associated with them, such as minting, listing, and transferring. As long as NFT ownership does not unlock features or functionality within the app, apps may let users view their own NFTs. Users of apps may browse NFT collections owned by others, provided that no buttons, external links, or other calls to action are present that point users to alternative purchasing options to in-app purchases.
Even though the last sentence in the bolded section is quite obvious, it still surprises me that Apple would ask for a share of the gas taxes. Before Coinbase’s tweet thread, I would have assumed that Apple would only insist on the use of its in-app purchase system in scenarios where users could buy or trade NFTs.
Though those discussions with the mobile phone manufacturing company might be a little tense after its CEO tweeted that the App Store is a monopoly (the jury is actually still out on that) and that some of Coinbase’s conversations with Apple have been “absurd,” online platform for buying and selling crypto says it hopes that this was all just an oversight and that it will be able to resolve things. Traded company is already responding to user evaluations of its credit storing app and advising users to use the Chrome extension, but if this is truly the company’s policy, it will be necessary to find a workaround.
Good example of the kinds of discussions we have with Apple on a monthly basis, to deal with their app store monopoly. It's gotten pretty absurd at times. https://t.co/g43JPDoYZX— Brian Armstrong (@brian_armstrong) December 1, 2022
NFTs are still declining
Even though the NFT transfer feature on Coinbase Wallet is now disabled, there may not be much harm. This is because, since January of this year, the demand for NFTs has been declining with each passing month. The entire sales volume produced by NFTs at the start of 2022 was $17.1 billion.
However, just $414 million worth of NFT sales were reported for the month of November, the lowest level since June 2021. Additionally, it appears that there is no increase in interest in NFTs, allowing December to report even lower sales volume.
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Disclaimer: This blog is for educational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.