Apple Quietly Battles Bitcoin Transactions Out of App Store

| Analysis

Apple and BitcoinApple has pulled another yet Bitcoin app from the App Store: Blockchain, the online wallet app from Blockchain.info. With this latest action, Apple has systematically removed the ability to conduct Bitcoin transactions from the App Store, and it's unclear why.

Blockchain.info is the world's largest online Bitcoin wallet, a service that allows users to store, send, and receive Bitcoins through the company's servers. It competes with dedicated Bitcoin wallet software that one must maintain on one's Mac, PC, or Android device. According to the company, Apple said that the iOS app was removed for an "unresolved issue," but didn't explain further.

That means iOS device owners must now rely on Web interfaces for online wallets—including Blockchain.info's website—if they want to conduct Bitcoin transactions on those devices. While there are dozens of Bitcoin tickers, mining pool apps, and Bitcoin information apps on the App Store, this is the fourth Bitcoin app that Apple has pulled in the last few months, including all wallets.

Previous recipients of Apple's boot include online wallets Coinbase and BitPack, the latter closing up shop after being kicked from the App Store. Gliph, a social networking app that allows you to attach a Bitcoin wallet to your Gliph account, was booted, but eventually returned without the ability to send or receive Bitcoins. Users can, however, view their wallet balance.

Why Now?

The question is why Apple decided to kick Blockchain from the App Store now? "We’ve been there two years," Blockchain.info CEO Nicolas Cary told Bloomberg. "What did they just discover that is now unresolved?"

Apple has a track record of being very secretive with how it manages App Store submissions, but immediate speculation has centered around section 22.1 of the App Store Review Guidelines. That section says, "apps must comply with all legal requirements in any location where they are made available to users. It is the developer’s obligation to understand and conform to all local laws."

As noted by TechCrunch back in December when Coinbase was kicked, Bitcoin isn't illegal in the U.S. The cryptocurrency isn't illegal anywhere, though it is under threat in China and India. At the same time it isn't expressly legal, either. Laws have yet to be written that either sanction or forbid the use of Bitcoin, making its status murky.

Bitcoin Threat?

Some believe that Apple is kicking Bitcoin wallets to the curb because of the company's rumored plans to get into mobile payments. This includes Blockchain.info's Nicolas Cary who told Wired, "I think that Apple is positioning itself to take on mobile payments in a way they haven’t described to the public and they’re being anti-competitive."

The biggest problem with that thesis is that Apple's mobile payment system will hardly compete with Bitcoin, at least not as we know either concept today. While Bitcoin is surging in popularity—I'm a big fan and have a tiny BTC holding—it's still a tiny pimple on the bum of international commerce.

To wit, Blockchain.info told Bloomberg that 120,000 people had downloaded the Blockchain app from the App Store. 120,000 people is a lot of people, but Apple had 600 million iTunes accounts with credit cards back in November of 2013.

Blockchain.info is only one online wallet service, but the entire Bitcoin economy could grow exponentially many times and still not be in the same league as the number of iTunes accounts Apple can bring to bear on mobile payments.

In addition, Bitcoin's popularity today is primarily centered around person-to-person transactions. That could change as more merchants begin accepting Bitcoins but, again, we'd have to see years of exponential growth for it be a threat to the traditional retail transactions I believe Apple is most interested in.

The idea of Apple seeing Bitcoin as a competitive threat to an Apple-branded mobile payment service is simply not reasonable, and remember that I'm a huge fan of Bitcoin.

So, Why?

That still leaves us with the question of why Apple is killing Bitcoin wallets. I assume it's paranoia over Bitcoin's potential to be declared illegal, and that Apple is covering its bases in a way that would please its attorneys. It's even possible that Apple believes sending Bitcoins from within an iOS app violates its Apple-gets-30-percent-of-all-purchases rule.

If that's the case, it's wrong. After all, Apple doesn't get 30 percent of every transaction conducted on Citibank's, JPMorgan's, or any other bank's app. Sending money to someone or buying something at a retailer who takes Bitcoins is not something Apple gets to always make money off of. It's just not.

Either way, the company is making a mistake. In that cryptocurrencies will grow in popularity, Apple should want iOS to be the premier platform for Bitcoin, just like it is with the Starbucks app. That app allows users to pay for coffee at Starbucks locations—and to recharge the app from a credit card attached to Starbucks— without giving Apple a cut.

As it is, Apple is chasing Bitcoin enthusiasts away for no good reason, for no gain.

Comments

Bosco (Brad Hutchings)

Brian Hall (Missing Sync) once put it this way… Pick one: sole source or curated store.

But no sideloading rule is what gave Android an opportunity in the first place. So I’m thankful that Apple shot itself in the foot with that.

John Dingler, artist

The Bitcoin phenomenon seems to have sprung out another true democratic process in that it gives recognition to another form of money. I look forward to even more forms of money. After all, currency of the world’s nations get along on the monetary front, so why not more forms of domestic currency?

bitcoin37

there are more peaceful ways to get Apple’s attention about this ..

http://www.youtube.com/watch?v=Ws91Pzx-HLw

this video illustrates my point…

The Peak Oil Poet

you say

“The cryptocurrency isn’t illegal anywhere, though it is under threat in China and India”

wrong

it’s illegal to trade in bitcoin in Thailand, not sure where else

one fact wrong? how many others?

p

BruceL

It is sad to see Apple do this. I suspect that Apple’s lawyers were concerned about attempts that may be made by the privately owned central banks of the United States, also known as the Federal Reserve Banks, to define Bitcoin as a counterfeit currency. Bitcoin holds so much potential for 99% but definitely is a threat to private central banks around the world and governments who believe they have a right to observe everything you do with your money. This is already in evidence by attempts of these same interests to link Bitcoin to illegal activities and terrorists. This overlooks the fact that cash, diamonds, and gold can and are used to finance these same activities. Bitcoin is like a knife it can be used for good but some will use it for evil purposes. Our current money which has been devalued as a result of its overprinting by the Federal Reserve Banks. These same banks make an enormous profits on the banking fees they charge to merchants as well as debit and credit card users. I really want to see Bitcoin or some other valid crypto-currency gain acceptance but believe that we need to educate others about the potential good that would come from using these. The corporate media is controlled by the 1% and will continue to demonize Bitcoin or say that the government must regulate it. I will conclude by saying Bitcoin is not bad and we do not need our ineffective, corporate controlled government to regulate it.

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