Coinbase says Apple blocked NFT transfers on its Wallet over App Store commission

US-based cryptocurrency exchange and Web3 services firm, Coinbase, on Thursday said that Apple blocked a feature on its wallet that allowed users to transfer non-fungible tokens (NFTs) among each other — citing the former’s non-compliance with the notorious 30% commission that the iPhone maker charges for transactions on its software platforms. In a series of tweets detailing the issue, Coinbase said that the blocking of the feature showed “oversight on Apple’s behalf”, and that because of the nature of the technology at hand, the Web3 platform “couldn’t comply even if (they) tried.”

Apple did not offer a statement on the matter at the time of publishing of this story. On iOS, NFT transfers remain missing from the Coinbase Wallet app.

NFTs, which are digital art pieces that are signified to be unique by virtue of an encrypted, digitally ‘signed’ token, can be stored in encrypted ‘wallets’ on devices — such as Coinbase’s own eponymous wallet. When an NFT is purchased, or transferred between two users, there is a transaction fee — known as ‘gas fee’ — that is generated to facilitate the transaction.

It is this fee that reportedly caused Apple to suspend the latest update version of Coinbase Wallet on the iOS App Store.

“Apple’s claim is that the gas fees required to send NFTs need to be paid through their In-App Purchase system, so that they can collect 30% of the gas fee. For anyone who understands how NFTs and blockchains work, this is clearly not possible. Apple’s proprietary In-App Purchase system does not support crypto so we couldn’t comply even if we tried. This is akin to Apple trying to take a cut of fees for every email that gets sent over open Internet protocols,” Coinbase said through its official Wallet handle in a series of tweets.

As a consequence of this move, the company said that iPhone users who own NFTs would find it “a lot harder to transfer NFTs to other wallets, or gift it to friends or family.”

Coinbase’s debacle comes days after Twitter’s new chief, Elon Musk, alleged that Apple threatened to pull the Twitter app off its mobile app store. However, the executive did not offer details as to what the contributing policies were behind this alleged incident.

Apple’s app store commissions have been frequently pulled up for scrutiny around the world, with major companies calling out Apple for ‘predatory pricing’, and ‘misuse of market dominance’. In India too, Apple is expected to face the Competition Commission of India (CCI) with regards to the same matter. Globally, companies such as Spotify and Epic Games have also voiced their opposition of the allegedly steep commission rate that the company charges developers for letting them sell their apps on the App Store.