Bankless: How the App Store ruling will open the door for on-chain applications?

An in-depth analysis of the prolonged legal battle involving Epic will be conducted, exploring its far-reaching impact on mobile application developers.

Written by: Bankless; Translated by: Tao Zhu, Jinse Finance

What happens when the largest tech monopoly in the world is taken to court by one of the most powerful studios in the gaming industry and ultimately loses? The answer is likely to change mobile development forever...

After nearly five years of legal battles, Epic Games has forced Apple to rewrite the rules of the App Store. This not only brings tremendous opportunities for cryptocurrencies but also marks a turning point for developers who have long been constrained by Apple's walled garden: they can finally profit freely according to their own will.

Today, we will delve into the long-standing legal battle of Epic and explore its far-reaching impact on mobile app developers.

Apple's Antitrust Liquidation

In August 2020, Epic Games sued Apple, accusing the tech giant of anti-competitive behavior after it removed Epic's popular multiplayer battle royale game, Fortnite, from the App Store.

The core of the controversy lies in Apple's policy, which mandates that all in-app purchases must go through the App Store and charges a fee of up to 30% for payments; Epic Games attempted to circumvent this predatory policy by launching its own in-game payment system.

Although Apple ultimately made a small concession by allowing developers to link to other payment options, the updated policy still requires a 27% revenue share with Apple and strictly limits the way payments are displayed within the app.

Both parties were unwilling to make concessions, but after nearly five years of protracted litigation, the U.S. District Court for Northern California finally issued a final ruling on the case.

In a scathing eighty-page ruling, Judge Yvonne Gonzalez Rogers found that Apple intentionally violated the law by setting up anti-competitive barriers designed to protect its billion-dollar App Store revenue streams.

In addition, she also submitted Apple Inc. and one of its vice presidents of finance to federal prosecutors, accusing them of contempt of court for violating a prior ban issued in 2021 against anti-competitive pricing practices in app stores.

The ban against Apple in 2021 primarily challenged its arbitrary practice of charging a 30% commission, and this latest ruling explicitly prohibits Apple from charging commissions on purchases made outside of the app, as well as controlling the way developers communicate with users.

The Golden Age of Cryptocurrency?

In order to comply with the ruling of Judge Gonzales Rogers, Apple was forced to update its App Store review guidelines for the United States.

The revised guidelines not only lift any bans on external links but also explicitly allow developers to showcase NFT collectibles to users. This marks a significant victory for the emerging gaming industry in the cryptocurrency space, struggling on-chain artists, and others profiting from blockchain collectibles.

However, most importantly, the updated guidelines will exempt U.S. applications from Apple's ban on external payment methods that allow them to bypass the 30% revenue share from the App Store.

Cryptocurrency payments are praised for their almost instant speed and extremely low costs. Previously, mobile app developers could only use approved high-fee payment channels, but Apple's recent legal defeat has cleared the way for developers to use any payment method they desire!

In an era where mobile applications allow users to choose their payment methods, many cost-conscious developers rationally abandon Apple's "walled garden" and high fees in favor of other solutions.

The default use of App Store payments provides undeniable convenience for end users of the app: they have already registered their payment information with Apple, and therefore may be unwilling to store sensitive financial information on random third-party platforms.

While large studios like Epic Games may find it worthwhile to independently develop proprietary payment portals, this new limitless environment provides fertile ground for experimentation with stablecoins for smaller studios.

Application users no longer need to repeatedly load their credit card information onto random websites and pray that they are competent enough to protect that information. Instead, they can make instant payments using any token in their crypto wallet, simplifying the payment process and ensuring that all participants have a trustless experience.

Conversely, developers can access all their funds (which may be stored in stablecoins) instantly, and outsource payment responsibilities to on-chain economies built specifically for this purpose, allowing them to focus on game development.

This is a truly compelling proposal for all parties involved, as it promotes interaction between users and applications, enhances the economic benefits of mobile app development, and encourages cryptocurrency payments to become mainstream.

Apple's policy shift is still pending confirmation, but the door to mobile monetization is clearly open. In this new era, developers can build, profit, and scale according to their own wishes.

With the emergence of seamless crypto payments, the future of on-chain applications has never looked so bright.