Coinbase has accused Apple of forcing it to remove NFT transfers from the Wallet app on iOS. On Thursday, it tweeted that Apple “blocked our last app release until we disabled the feature” because the iPhone maker wanted the blockchain fees associated with an NFT transfer to go through its in-app purchase system, giving it a 30 percent discount .
According to Coinbase, it is impossible to do that for several reasons, the main reason being that Apple’s system does not support paying in cryptocurrency.
While on some NFT marketplaces you can buy the digital tokens using traditional fiat currency like the US dollar, the fees that Coinbase talks about are a whole other matter. On blockchains like Ethereum, which many NFT projects use, a fee is charged for each transaction, which is paid to the people who validate it. The fees are collected in cryptocurrencies, such as ETH. That’s true even if you send someone an NFT for free.
Importantly, no portion of the gas fee goes to Coinbase or the person receiving the NFT. The fee also changes from time to time based on various factors such as the price of the cryptocurrency or how many people are trying to get transactions validated. In other words, it’s really not something Apple’s in-app purchase system is set up for.
Despite that fact, it’s not necessarily a surprise that Apple told Coinbase not to keep its NFT transfer system as it was. In October, the company Rating Guidelines for the App Store to specifically address NFTs with this new addition under Section 3.1.1 In-App Purchase:
Apps can use in-app purchases to sell and sell services related to non-fungible tokens (NFTs), such as minting, listing, and transferring. Apps can allow users to view their own NFTs, provided NFT ownership does not unlock features or functionality within the app. Apps allow users to browse NFT collections owned by others, provided the apps do not contain buttons, external links, or other calls to action that direct customers to purchase mechanisms other than in-app purchases.
That last part of the bold section is pretty black and white, but it’s still a little surprising that Apple would demand a reduction in gas costs. Before Coinbase’s tweet thread, I would have guessed that Apple would only require its in-app purchase system to be used in a market situation where people could buy or sell NFTs.
The interpretation Apple seems to have applied here – we reached out to the company for comment but didn’t immediately hear back – would affect transfers where you merely move an NFT between your own wallet or give it as a gift to friends and family sends, to borrow an example from Coinbase. (Side note: If a friend or family member sent me an NFT for any reason, I would disown them.)
Coinbase says it hopes this is all just a mistake and will be able to straighten things out with Apple, though those talks may be tense afterward tweeted the CEO that the App Store is a monopoly (the jury is literally still out) and that some of Coinbase’s conversations with Apple were “absurd.” However, if this is really Apple’s rule, Coinbase knows the score and will just have to find a way around it – right now it’s responding to reviews in its Wallet app and instructing users to download the Coinbase Wallet Chrome extension .