Brian Armstrong, the CEO of United States cryptocurrency exchange Coinbase, alleges that Apple is stifling innovation in crypto and sidelining DeFi to protect itself from competition.
The CEO alleged that other cryptocurrency firms are “reluctant to speak out on these topics for fear of retaliation,” but that he feels the need to speak out as Coinbase has exhausted regular channels for dialog with Apple and has reached a “dead end.”
According to Armstrong, Apple has told Coinbase that it is prohibited from adding two specific functionalities to its iOS apps: the ability to earn money using cryptocurrency and access to decentralized finance (DeFi) apps.
The first restriction, which affects the exchange’s Coinbase Earn product, has reportedly led to Coinbase having to modify its app in a way that is significantly less user friendly.
The CEO claimed that these restrictions are specific to cryptocurrency users, stating, “Why would Apple want to prevent people from earning money during a recession? They seem to not be ok with it, if it uses cryptocurrency.” For iOS users, Armstrong claimed, crypto apps lack features not because of developers’ inactivity but because those features are “being censored by Apple.”
In addition, Apple reportedly bars Coinbase from providing app users with a list of decentralized applications or DeFi apps, both of which “are really just websites.”
Apple’s justification for this has apparently been that “"Your [the Coinbase] app offers cryptocurrency transactions in non-embedded software within the app, which is not appropriate for the App Store."
Noting that DApps and DeFi apps can regardless be accessed via a web browser on any smartphone, Armstrong claimed that Apple’s decision is motivated by a “conflict of interest.”
While these restrictions “are ostensibly designed to protect customers, it increasingly looks like they are also protecting Apple from competition,” he wrote.
By compelling users to use the Apple App Store instead of DApps, or In-App Purchases instead of crypto payments, Armstrong claimed that Apple’s actions have a parallel in Microsoft’s past antitrust issues when it compelled Windows users to use its proprietary browser, Internet Explorer.
During the coronavirus crisis, when underbanked or unbanked populations may face even greater difficulties accessing traditional financial services, Armstrong accused Apple of placing yet a further barrier to financial inclusion.
Coinbase is reportedly planning to submit a formal request to Apple to amend its App Store policies.