Apple App Store limits NFT functionality, tightens rules for crypto
Apple Inc. has released new guidance for its App Store rules along with software updates for iOS 16.1, iPad OS 16.1 and MacOS Ventura that tighten how cryptocurrency exchanges can operate in the store and non-fungible tokens can be used in the apps.
According to the new guidelines, Apple has clarified that apps can use non-fungible tokens, but that they cannot be used to unlock additional functionality.
Non-fungible tokens, or NFTs, are a type of blockchain-based cryptographic asset that provides provable ownership of digital assets such as digital art, files, music, tickets, video game items, and other virtual ephemera. Using blockchain technology, it is possible to create, store, buy and sell NFTs for cryptocurrency, which in turn can be traded for real money and as a result show ownership of the underlying digital asset.
Under Apple’s new guidelines, apps can buy and sell NFTs, such as minting, listing and transferring and viewing, but ownership cannot unlock additional features.
“Apps may use in-app purchases to sell and resell services related to non-fungible tokens, such as minting, listing and transfer,” the guidelines state. “Apps may allow users to view their own NFTs, provided that NFT ownership does not unlock features or functionality within the app.”
Furthermore, the apps are permitted to allow users to view NFT collections as long as they do not include buttons or external links that “direct customers to purchase mechanisms other in-app purchases.”
The goal of this is to keep users inside the App Store so that NFT trading services use Apple’s in-app payment services that take up to a 30% cut from in-app purchases. This major cut of in-app purchases was central to a lawsuit by Epic Games against Apple over the removal of the popular video game “Fortnite” from the App Store.
While this move does not prohibit NFTs in apps, which are widely used in a variety of different types of Web3 applications that use blockchain technology to create peer-to-peer token-based economies, it greatly limits their ability to provide opportunities to users.
This is because NFTs are often by app makers to control or “gate” functionality based on ownership of tokens. For example, if a user has or owns a certain NFT, it can unlock special discounts at a store, or exclusive items that are only available to certain token holders.
An example of an app that would run afoul of Apple’s new guidelines is Shopify, which launched “token commerce” that allows just this. Using it, store owners can give members with NFTs early access to limited-edition exclusive items, experiences and more. This functionality will no longer be possible for developers to take advantage of in Shopify on the App Store.
This would also completely remove communities like Moonbirds NFTs and Bored Ape Yacht Club NFTs, which not only offer collectible art experiences, but also offer exclusive access to chat rooms, exclusive merchandise and other incentives to NFT holders.
The new rules also change how apps unlock content and functionality, not only for NFTs, but they cannot use their own mechanisms such as Quick Response codes, license keys, augmented reality tokens, cryptocurrencies, crypto wallets or anything else.
Further developing Apple’s clarification on rules regarding cryptocurrencies, the rules also said that apps can facilitate cryptocurrency transactions and transfers on approved exchanges, but only those in approved countries where the app was licensed and permitted to provide exchange services.
