Apple's Updated Guidelines Prohibit Use of NFTs to Gate Access to Additional Content, Features

Apple's updated App Store guidelines speak about what NFTs can and can’t be used for.

Written by Shomik Sen Bhattacharjee, Edited by Siddharth Suvarna | Updated: 25 October 2022 14:09 IST

Photo Credit: Unsplash/ Laurenz Heymann

Apple has been working for a while to bring a framework for NFT sales.

Highlights

Apps can continue to "sell and sell services related to" NFTs
Apple limits NFTs acquired from elsewhere only for viewing
Apple has banned hosted NFTs from packing additional functionality

Apple has updated its App Store policy to restrict apps from using non-fungible tokens (NFTs) to incentivise users to purchase items or features the tech giant can't tax. The Cupertino, California-based company charges up to 30 percent both on all purchases made on its App Store and all money spent when using apps. In a recent update, Apple updated its policy to prohibit apps from using NFTs that include "buttons, external links or other calls to action that direct customers to purchasing mechanisms other than in-app purchase."

Apps can "sell and sell services related to" NFTs "such as minting, listing and transferring," according to Apple's update. But, using NFTs to unlock additional "features or functionality" is not allowed.

Folding additional functionality and premium features into NFTs is a way to boost their utility or value. With trading volumes cratering in recent months NFT creators are trying to be more creative with how they market NFTs. Attaching added features is, in some cases, viewed as a way to increase demand.

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That said, Apple's move may actually deter users from purchasing NFTs, as the main use case for NFTs is that they can sometimes unlock token-gated content. For example, the Moonbirds NFTs and Bored Ape Yacht Club NFTs offer holders exclusive access to various communication channels, merchandise, and other such perks.

Apple has already been criticised by NFT startups for wanting to take 30 percent of NFT transactions when marketplaces charge about one-tenth of that percentage. Effectively Apple's policy means that users are severely discouraged to do anything more than using marketplace apps like OpenSea and Magic Eden to view NFTs. If a user wants to buy or sell an NFT, they can do so for much cheaper on the marketplace's website.

Beyond just NFTs, Apple has also revised some of its language surrounding cryptocurrency exchange apps listed on its App Store.

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"Apps may facilitate transactions or transmissions of cryptocurrency on an approved exchange, provided they are offered only in countries or regions where the app has appropriate licensing and permissions to provide a cryptocurrency exchange," the guidelines state.

Apple launched the iPad Pro (2022) and the iPad (2022) alongside the new Apple TV this week. We discuss the company's latest products, along with our review of the iPhone 14 Pro on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.

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