Web3 Apps May Benefit From Court Ruling That Called Apple’s Ban on Third-Party Payments ‘Unlawful’

Apple’s strict App Store rules, that do not allow outside payments, have been challenged by Epic Games, in a long-running antitrust case.

Written by Radhika Parashar, Edited by Manas Mitul | Updated: 26 April 2023 14:16 IST

Web3 Apps May Benefit From Court Ruling That Called Apple’s Ban on Third-Party Payments ‘Unlawful’

Apple’s payment policy has previously been criticised by Coinbase CEO

Highlights

Apple intends to appeal the latest antitrust ruling
Epic Games’ CEO has called Apple out for unfair app payment rules
Apple Pay does not support crypto transactions

Apple's policy of not allowing app developers to integrate third party payment methods with their services was upheld as ‘unlawful' by a California appeals court earlier this week. The iPhone maker takes a 30 percent cut on all in-app purchases and enforces strict App Store rules. The court ruling could bring changes to Apple's App Store payment practices and could also allow Web3 apps to add more operability to their iOS apps. Web3 apps comprise new tech elements like cryptocurrencies, metaverse, and non-fungible tokens (NFTs).

Apple's stringent App Store rules have been challenged by Epic Games, the creator of the Fortnite, in a long-running antitrust case, with the latest ruling upholding a 2021 order.

The United States Court of Appeals for the Ninth Circuit said Apple's restrictive payment rules for iOS app developers harmed their businesses, including that of Epic Games'. The rules have been called out for also meddling with the consumer engagement with these apps.

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The development was confirmed by Tim Sweeney, the founder and CEO of Epic Games.

“The court upheld the ruling that Apple's restraints have ‘a substantial anticompetitive effect that harms consumers',” Sweeney wrote in his tweet.

Fortunately, the court's positive decision rejecting Apple's anti-steering provisions frees iOS developers to send consumers to the web to do business with them directly there. We're working on next steps.
— Tim Sweeney (@TimSweeneyEpic) April 24, 2023

The digital assets sector carries along an infamous reputation of being volatile. In a bid to safeguard iOS users from exposing themselves to the financial risks of dabbling with crypto, Apple maintains strict rules on the platform.

Last year in April, Coinbase CEO Brian Armstrong expressed disappointment on the existing rules of Apple's App Store, which he said hindered the ease of integrating new payment options other than Apple Pay for pro-Web3 developers.

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Presently, Apple Pay does not support cryptocurrency transactions. Crypto payments are not accepted for iPhones and other Apple products, and as pointed out by Armstrong, App Store is also resistant against supporting crypto apps. Crypto wallet apps, however, are available on the App Store.

“Apple so far has not really played nice with crypto; they've actually banned a bunch of features that we would like to have in the app, but they just won't allow it — so there's potential antitrust issues there,” the 39-year-old Coinbase chief had said at the time.

Apple plans to appeal the latest ruling. “We respectfully disagree with the court's ruling on the one remaining claim under state law and are considering further review," the tech giant said in statement.

Xiaomi launched its camera focussed flagship Xiaomi 13 Ultra smartphone, while Apple opened it's first stores in India this week. We discuss these developments, as well as other reports on smartphone-related rumours and more on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.

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Further reading: Cryptocurrency, Apple, iOS Crypto Apps, App Store

Radhika Parashar

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Radhika Parashar is a senior correspondent for Gadgets 360. She has been reporting on tech and telecom for the last three years now and will be focussing on writing about all things crypto. Besides this, she is a major sitcom nerd and often replies in Chandler Bing and Michael Scott references. For tips or queries you could reach out to her at RadhikaP@ndtv.com. More