Apple is set to enable in-app NFT purchases on the Apple Store, but will impose a 30% commission fee on all NFT sales. The decision sparked displeasure throughout the community, as the fee would put NFT sales on par with regular in-app purchases.
Huge Commission Fee
Apple has reportedly greenlit NFT purchases through applications listed on its marketplace, but allegedly intends to apply its standard 30% commission fee to all NFT sales made in-app. The fee is identical to the 30% commission applied to Android app store Google Play.
The commission fee represents a hefty upcharge compared to the typcial NFT marketplace commission rate of roughly 2.5%. The NFT marketplace applications currently available on the Apple Store are OpenSea, Rarible, and Magic Eden. The platform also offers a range of crypto trading apps, such as Binance, Crypto.com, and Coinbase Wallet.
NFT Marketplaces Are Avoiding the Apple Store
Although Apple has since promised to reduce its fee to 15% following the community’s response, Magic Eden, a popular Solana (SOL) NFT market, has elected to withdraw its services from the Apple Store. Despite this, the Magic Eden app is still listed on the app store at the time of writing. Meanwhile, other NFT marketplaces have reportedly opted to provide only limited functionality on their Apple Store apps, in protest of the high fees.
A further drawback of the Apple Store for Web 3.0 companies is that transactions can only be carried out in USD, with no cryptocurrency functionality offered. Given the volatility of the cryptocurrency markets, this can prove problematic in some instances.
Harsh Response from the Web 3.0 Community
Web 3.0 app developers and community members have reacted negatively to Apple’s intent to take a 30% cut from NFT sales conducted through applications on its marketplace.
Epic Games CEO Tim Sweeney stated on Twitter that Apple “must be stopped” as it is “crushing another nascent technology.”
Florian Mueller, a tech blogger, called Apple’s “app tax” on NFT purchases “abusive, but consistent,” and suggested that NFT startups conduct trade away from the Apple Store.
On the Flipside
- Metaverse-linked NFTs are predicted to be the fastest-growing market for NFTs throughout the next five years, with experts estimating an increase from the 600,000 transactions seen so far in 2022, to 9.8 million by 2027.
- This is not the first time Apple has come under fire for its high commission fee. Epic Games has previously taken legal action against the tech giant, after its iconic game, Fortnite, was removed from the App Store in August 2020 for attempting to provide in-game purchases that circumvented Apple’s fees.
- Epic Games CEO Tim Sweeney has long argued that Apple’s commission rates are not developer-friendly, and offer little opportunity for the industry’s growth.
Why You Should Care
The volatility of cryptocurrencies has influenced the market value of NFTs. While startups and trading firms in the Web 3.0 space would like to be listed on the App Store in order to reach a larger audience, under Apple’s commission rules, such businesses stand to lose significant chunks of profit on transactions made in the app, which typically deters them from entering the marketplace.
Read more about the potential value generated by the NFT technology:
The Real Value of NFTs Beyond Expensive JPEGs
Read more about Magic Eden marketplace attempt to impose creators royalties:
Magic Eden’s Attempt to Protect NFT Creators’ Royalties Gets Backlash from Community