Apple is currently dealing with a fresh class-action lawsuit filed by users of Venmo and CashApp. These users allege that Apple engaged in a conspiracy to restrict peer-to-peer (P2P) payment choices on its devices, with a particular focus on limiting cryptocurrency payment solutions.
As per the complaint, Apple’s agreements restrict the ability of P2P payment apps to compete in terms of features. This includes preventing both existing and new platforms from utilizing decentralized cryptocurrency technology. Consequently, users need more access to a wide range of payment options, leading to inflated prices when they attempt to send money or engage in cryptocurrency trading.
The complaint argued that these agreements restrict feature competition and prevent price competition, both on a marketwide scale. This is achieved by prohibiting the integration of decentralized cryptocurrency technology into iOS peer-to-peer payment apps, whether they are existing or new.
The Goals of the Lawsuit
The lawsuit aims to obtain an injunction that, if granted, may require Apple to separate or isolate its Apple Cash business. In addition to the allegations above, it has been asserted that Apple has deliberately omitted two Bitcoin wallet applications, namely Zeus and Damus, from its App Store. The plaintiffs are seeking to compel Apple to allow the utilization of the cryptographic wallets that have previously been inaccessible.
Venmo and Cash App users complained on November 17 in a California District Court. Apple has engaged in agreements that restrict competition with both of those payment platforms. Interestingly, the lawsuit did not involve PayPal, the parent company of Venmo, or Block, the parent company of CashApp. Evidently, the plaintiffs believe that Venmo and CashApp were compelled into this agreement.
In addition to the allegations, Apple was also accused of compelling developers to exclude any potential cryptocurrency features from new P2P applications designed for its devices. The plaintiffs claim that Apple imposed restrictions on new payment apps, requiring them to prohibit cryptocurrency trading in order to be allowed entry.
Paying Apps Are Coming Under Increased Scrutiny
All of this takes place against the background of a proposal that the Consumer Financial Protection Bureau made earlier this month to regulate all payment apps and digital wallets, including Apple Pay, CashApp, and Venmo, in the same manner, that it would oversee any other business that deals with financial transactions.
Every “general purpose digital consumer payment application” would be subject to the same compliance regulations as financial institutions and credit card firms, according to the plan. The likelihood is that Apple and its partners would like to steer clear of it.
There is not much of a possibility that the case that Apple filed would be successful. In addition, Apple has recently been engaging in efforts to incorporate Venmo within its operating system better.
Nevertheless, in order to prevent more scrutiny and regulatory intrusion, it is not out of the question that Apple would make certain modifications in order to widen access to a variety of payment applications and extend its capabilities in the realm of cryptocurrency, even if these modifications are simply cosmetic.