Apple’s feud with cryptocurrency and blockchain

Reporter: Lydia

Apple, a large high-tech company, always becomes the focus of public opinion, whether it is selling well or being criticized for its innovation. Recently, a report was released about Apple's continued decline in the fourth quarter of last year, Apple's market share was lower than that of domestic mobile phones, and Apple's mobile phone security incidents. Is Apple frustrated and at the end of its rope? Today, in 2017, the year of financial technology competition, let's review the love and hate between Apple and digital currency and blockchain.

The review starts with Bitcoin wallet Blockchain and protesters smashing iPhones.

In February 2014, Apple blocked all cryptocurrency wallets and currency exchange applications, even forcing several apps including Blockchain.info, Coinbase and Coinjar to be removed from the shelves.

Blockchain, which was removed from the App Store, was the only Bitcoin wallet app in the Apple App Store. It had been downloaded over 120,000 times in the two years since it was launched and was very popular among users.

There are two reasons for the removal: one is to eliminate competitors in the payment system; the other is that Bitcoin is still on the verge of legality in the United States. There is speculation on Twitter that Apple's move is to hit competitors, but many payment apps in the App Store such as PayPal and Square have been spared.

More people believe that it is probably because Bitcoin poses a threat to the digital currency project previously developed by Apple (called iMoney). These actions of Apple once again demonstrate their ambition to monopolize the field of mobile payments.

Not long after Apple's cautious attitude towards cryptocurrency, a turning point occurred.

On July 29, 2014, Blockchain, the most popular Bitcoin wallet application, returned to the Apple App Store.

Apple revised its regulations on virtual currencies after this year's WWDC, and no longer bans all applications that support Bitcoin transfers and transactions as it did in the past.

The general background is that in the first half of 2014, many large merchants abroad also began to support Bitcoin payments, such as Newegg, Dell, Dish network, etc., and there are more and more places where ordinary people can use Bitcoin.

When Apple banned the app, it was a shot in the arm for the entire digital currency industry. Those developers then turned their attention to the Android platform, making Google's mobile operating system a hotbed for Bitcoin-related wallets and trading services. Bitcoin developers also received millions of dollars in support from venture capital firms such as Andreessen Horowitz.

It is understandable that the wind is changing, and Apple does not want to miss this opportunity.

Apple’s “taste” is very picky. In the summer of 2016, the Apple App Store reluctantly accepted Ethereum wallets, but only selected a few apps.

In August 2016, Apple began to turn its nose up at Dash, removing it from the Apple Store. Apple only approved Bitcoin, ETH, DAO, Ripple, Dogecoin, and Litecoin. Jaxx was given until September 16 to remove Dash functionality from iOS (desktop & mobile). The move sparked criticism from startups including digital currency wallet Jaxx and digital currency exchange ShapeShift, both of which had to remove their iOS apps at Apple's request. Apple is still very much about controlling their garden and only allowing things that match certain parameters to participate, but many of Apple's users saw the removal of Dash as a step backwards.

Apple Pay+digital currency?

On February 18, 2016, Apple Pay was launched and became the focus of public opinion. Almost everyone was discussing whether Alipay and WeChat were trembling. Analysts said that Apple Pay is just a chess piece. It is actually somewhat limited to only consider the good or bad of this move. If it can be linked to other chess pieces, we will see a different layout. In other words, if Apple Pay is linked to other areas of Internet finance, we will see a different situation. Among them, the most relevant area is undoubtedly digital currency.

Not too far from the time of Apple Pay, at the end of January this year, the relevant person in charge of the People's Bank of China said that the future prospects of mobile payment are bright, and the central bank is actively studying relevant research results and practical experience at home and abroad, striving to issue digital currency as soon as possible. In addition, it is revealed that the central bank has established a special research team since 2014 to conduct in-depth research on the issuance and business operation framework of digital currency, key technologies, circulation environment, etc., and has achieved phased results. This means that digital currency is not far away from us.

These two seemingly isolated events are related. They are both causing one thing to lose its meaning - paper money.

Understanding digital currency and electronic payment

An article titled "Digital Currency from Apple Pay" was cited by a well-known media, which is surprising. It seems that many people equate digital currency with electronic payment.

The current Apple Pay is not actually an electronic "wallet", but more accurately an electronic "card wallet". Our wallets usually contain both cash and cards, while Apple Pay (the pre-installed App in Apple phones is called wallet) is the virtualization (or dematerialization) of these cards (including bank cards, shopping cards, and even access control cards that support NCF technology, etc.). Apple Pay is not the virtualization of "paper money". The virtualization of paper money is digital currency. The real circulating paper money is decentralized and does not require bank account registration. Therefore, digital currency is more private than bank cards or virtual cards of bank cards (such as Apple Pay), just like cash banknotes are more private than transfer payments.

The privacy advantage of digital currency. When you need to pay, you may want to avoid leaving records through transfers, code scanning, etc., and may prefer to pay with cash. When there is no paper money, digital currency can achieve the same effect. In other words, bank cards, virtual bank cards (such as Apple Pay), third-party payments (such as WeChat and Alipay code scanning), and digital currencies are all used to replace and eliminate paper money! It's just that digital currency and paper money are more closely related.

Regarding how to store and pay digital currency, the most mature technology currently is blockchain technology.

Circle Pay enters the market

On September 13, 2016, iOS 10 will be officially updated and released. It has been criticized by global audiences for its lack of innovative applications and even some hardware settings that are "copied" from Chinese mobile phone manufacturers. However, some media reported that the criticism did not affect the sales. The pre-order orders of iPhone 7 and 7 Plus in the first three days increased by 375% year-on-year. T-Mobile said that the orders of the series in the first four days of release were nearly four times the sales of iPhone 6 in the same period, setting a record for the company. Stimulated by this, Apple's stock price rose nearly 3% during the trading session. These are still far from the previous generations.

The last gasp of a dying force reduced to ashes?

At that time, the news that the third-party platform Circle Pay had confirmed its entry added a strong color to Apple's post-Jobs era. The iOS 10 update added the Circle Pay function, and launched a newly designed iMessage service, which relaxed its attitude towards cryptocurrency and allowed third-party platforms such as Bitcoin P2P wallet Circle Pay to enter, which is applicable to all Apple products that support the upgrade to iOS 10.

Circle CEO Alar said that adding Bitcoin payment service to iMessage will benefit consumers and greatly simplify their payment behavior. In the mobile payment scenario, Circle Pay uses the underlying technology of Bitcoin, blockchain, allowing users to transfer money to each other instantly without fees. The most important thing is that through Circle Pay, users can directly transfer local currency to the accounts of foreign friends, and the other party can directly withdraw local currency. The principle is that Circle Pay will convert the initial currency into Bitcoin, and the funds will be transferred to the recipient's Bitcoin address through the blockchain. If the other party does not want Bitcoin, it will be converted into local currency again.

Circle Pay service allows users to complete payments through iMessage just like sending text messages. The international payment platform Circle can quickly expand its user base through a convenient entry point. Circle can make payments as conveniently as sending text messages, which is still a very considerate service upgrade from the user's perspective.

From the combination of Circle Pay and iMessage, we can see that Apple has a more open attitude towards such applications, and we will see more blockchain applications in the future.

According to the International Business Times: Ripple Labs (San Francisco digital payment company) is committed to the development of blockchain technology and announced its "InterLedger" protocol project (ILP) to attract more customer targets, including Apple and Google. Since there are still many problems with the network that relies solely on bank cards, Apple, Google, Mozilla and other companies are seeking a better user experience in online payments. Technology companies such as Google and Apple like blockchain technology more than Visa.