Thu, Dec 12, 2013 - Page 15 News List

Apple blocks payment via bitcoin on text app

SECURE MESSAGING:Apple declined to comment on why it blocks bitcoin payments, but allows other types of e-commerce transactions, such as PayPal and Square

The Guardian, LONDON

Apple has forced a secure messaging app to remove the ability to send bitcoin payments or be booted off the iOS App Store. The move reinforces belief that the company has an unstated policy against allowing bitcoin apps on the store, despite allowing alternative forms of e-commerce such as apps from PayPal and Square.

The app, Gliph, lets users send secure texts back and forth, and also hooks up with online bitcoin services Coinbase and Blockchain.info to allow them to send money to friends. However, that last feature was what raised Apple’s ire.

“We were asked by Apple to remove the ability to send Bitcoin from the iOS app,” the company’s cofounder Rob Banagale confirmed in a blog post. “We fought to keep it in but it was not possible... You can still create wallets, view balances and receive Bitcoin in the Gliph app for iOS.”

Coinbase itself, one of the two online wallets which Gliph uses to enable the bitcoin payments, was also forced off the App Store last month, and Blockchain.info’s wallet app was pulled from the App store last year.

Apple, which declined to comment on the issue, has been giving conflicting reasons to the developers of bitcoin apps. Blockchain was told that “the facilitation of trading of virtual currency is not appropriate for the App Store,” a rule which has no counterpart in the company’s own App Store guidelines.

Rob Sama, the creator of BitPak, another bitcoin app removed from the iOS store, says that he was told his app was removed because “that bitcoin thing is not legal in all jurisdictions for which BitPak is for sale.”

“I inquired as to which jurisdictions bitcoin was deemed to be illegal in, and he told me ‘that is up to you to figure out.’ I asked him which laws bitcoin violated, and again, he replied that ‘that is up to you to determine,’” Sama said after his app’s demise.

A year before that, Bitcoin Express, an app with similar functionality, was also removed. That time, the app’s developer was given a specific rule which was apparently being violated: 22.1 of the company’s guidelines, which reads “Apps must comply with all legal requirements in any location where they are made available to users. It is the developer’s obligation to understand and conform to all local laws.”

The legal status of bitcoin remains hazy, but there is only one country where even making transactions in the currency has been clamped down on: Thailand. The Thai central bank, not knowing how to deal with bitcoin, issued a preliminary ruling in July, which banned the currency until the bank could determine whether it could be used to speculate on the strength of the baht, which is illegal in the country.

Removing bitcoin apps from the store entirely, or curtailing their ability to send bitcoins, goes much further than merely removing them from the Thai App Store, and suggests that Apple considers the use of the currency legally questionable even in nations which have not pronounced on the issue.

That may be due to bitcoin’s long association with the black market — notoriously, the currency is mandatory on drug marketplaces like Silk Road 2.0.

However, any payment system can be used for crime; Apple has yet to clamp down on Silicon Valley darlings Square, despite reports that sex workers in California are charging customers using the e-commerce app.

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