US lawmakers probe Apple’s App Store rules on NFTs, other Web3 technologies

U.S. lawmakers have launched a probe into Apple’s (NASDAQ: AAPL) guidelines on its App Store concerning non-fungible tokens (NFTs) and blockchain technology.

The first shot was fired in the form of a letter directed at Apple CEO Tim Cook to disclose his company’s policy on Web3 technologies. The letter, written by Rep. Gus Bilirakis (R-FL) and Rep. Jan Schakowsky (D-IL), seeks details on whether Apple’s App Store’s policy was in breach of antitrust rules.

There are fears that the company may have limited the functionalities of Web3 apps on its store, a move which the lawmakers say “purposefully limit choice and stifle innovation at the expense of user experience.”

The lawmakers cited that NFT firms have alleged that Apple has forced them to launch “lite” versions of their mobile applications. The letter to Apple’s CEO noted the instance when Axie Infinity was asked to roll out a lite version that did not include NFT functionalities in the United States.

In 2022, Coinbase (NASDAQ: COIN) accused Apple of forcing it to eliminate NFTs transfers on its iOS devices as it sought 30% of the gas fees on NFT transfers. Coinbase noted that “Apple’s proprietary in-app purchase system does not support crypto so we couldn’t comply even if we tried.”

“It is essential that Congress fully understand the App Store Guidelines and the extent these guidelines limit innovation and American technology leadership,” read the letter.

The lawmakers added that stifling innovation and competition in the space could adversely affect the country’s leadership in blockchain technology and Web3. Cook has until August 14 to respond to the legislative inquiry amid heightened scrutiny of the company’s approach.

Experts opine that most of Apple’s defense will revolve around the inherent risk associated with blockchain technology and Web3. It is expected that Apple will cite the collapse of several centralized entities in the space and the high spate of digital asset crimes, including rug pulls. The company is expected to give necessary disclosures of its incoming sideloading feature, the nature of its data privacy and security standards, and whether Apple plans to build apps using the blockchain technology.

A closed-wall approach to AI

Despite taking the lead in artificial intelligence (AI) a decade ago, Apple is adopting a cautious approach toward its development.

In July, it was reported that the technology company was building a generative AI chatbot for internal use for its employees, dubbed Ajax, under strict conditions for usage. However, the firm has been steadily increasing its AI talent in recent months, but it remains unclear whether Apple will compete with OpenAI and Google (NASDAQ: GOOGL).

Apple joined Samsung (NASDAQ: SSNLF) in banning its employees from using ChatGPT over fears of a data leak. The ban extends to other AI tools including Copilot, seemingly placing privacy over innovation.

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