(4 minutes reading time)
Often antitrust is connected to behaviour in the disadvantage of competitors – and hence the dis-economies this brings for consumers – we should have a wider perspective at the (potential) negative impact companies have on society. Slowly but surely we should start looking at the disadvantages to society’s ability to collaborate as well.
Blockchain’s removal is another chapter in Apple’s tumultuous relationship with Bitcoin apps. The company has told developers behind Bitcoin-related apps that they may not include content that “enables, facilitates or encourages an activity” that some countries deem illegal. App Store Review Guidelines require that apps be legal in all locations in which the app is available.
NB See response from Blockchain. Also last week in Russia the Central Bank reiterated existing rules and how they apply to Bitcoin (BTC) in its territory. Via Russia Says Bitcoin Should Be Avoided [Updated] | TechCrunch:
…with existing [Russian] laws, transactions in Bitcoin are seen as “potentially suspicious.”
The reasons behind this move is that Bitcoin is reportedly used for money laundering and other criminal activities. Moreover, the Russian institution thinks that it’s a purely speculative currency and that there is a great risk of value losses. Bitcoin won’t be able to remain an unregulated currency for long. In Russia, today’s warning is another step in that direction, and it’s a radical step. Russia placed itself in an ever growing list of countries like India and China curbing Bitcoin to make it illegal or at least practically impossible to use it without being criminalized and to prevent the possibility to connect to the domestically operating bank system.
To me the developments by countries do not come as a surprise. I wrote “Bitcoins’ anarchistic character will be pounded into line by real world regulations” in June last year. The US has – as the countries mentioned above – indicated bitcoin has to obey the rules applicable to currency. (See: Bitcoin gets legally regulated in the US. It is regulating bitcoin but at the same time is embracing the innovation bitcoin and other crypto currencies (could) bring.
My thesis is that the US is in it self big enough to have Bitcoin cs. to develop further – in all its expects – and to move crypto currency into maturity on its own. If crypto-currencies pan out as a highly efficient currency annex payment method it will benefit the US reaping the fruits. (See “Why bitcoin matters“) What I did not consider at the time is the impact individual firms could have on the development of Bitcoin.
Can the exclusion of an important smartphone and tablet platform like Apple iOS threaten the development of Bitcoin?
VC’s in the US seem to say it will not change things much.
I deem it more significant. The size of Apples footprint is not big enough on its own to create a common wallet but it is big enough to hinder others substantially to become common enough to become mainstream (especially in the infant stages bitcoin is in). A wallet needs widespread platforms in peoples hands to reside. The most logical place – today – to have it available is the smartphone. iOS is – give or take – 50% of the installed base of smartphones in the US.
With the smartphone being the natural habitat for a wallet without a viable alternative in sight yet [or could the Nymi from Bionym, a bracelet using your hart rhythm as the password, make a difference?] the exclusion from the iOS’s app store will hamper the use of any electronic wallet for widespread adoption within crucial communities of early adopters and later on within the early majority which are needed for the payment wallets to reach critical levels of adoption.
If indeed the reasons of Apple are based on the notion that an app should only be available if legal everywhere they are limiting innovation to the smallest denominator. Secondly indirectly people outside of a country become subject to the laws of an other.
For instance, what about apps created for gay people? See recent legislation in Russia about preventing “promoting homosexuality”? Would that reasoning imply the general banning of these apps as well? Or what about content censored in a specific country which then will be censored elsewhere? Far fetched? This does not seem hypothetical any more: via Quartz Is Microsoft’s Bing spreading the Chinese government’s censorship around the world?. (NB titbit on the side: with visitors at Red Planet Dust from 58 countries including Taiwan and Hong Kong to date I have not had a single visitor from China. Coincidence? Lanquage gap? The great wall?)(update 13-02-’14: Microsoft denies acquisition)(update 7 march 2014: Yippee, the first visitor from mainland china has been spotted on RPD today!)
Some argue it has to do with Apple trying to have bitcoin as a competitor to the upcoming apple wallet. (see: The inevitable Apple wallet will turn around the payments chain from payee to payer.) I doubt that. There are many wallets already on iOS which are much more substantial in use then bitcoin will be for a long time and which will be competing head to head with the Apple wallet when it arrives.
To me social choices should not be left to companies. In practice this can not be avoided as all actions will have a social impact. We as a society trust upon companies certain liberties to act. But this is within (most preferably) democratically decided boundaries. When misusing this trust, for instance by monopolistic behaviour, companies face antitrust actions. Often antitrust is connected to behaviour in the disadvantage of competitors – and hence the dis-economies this brings for consumers – we should have a wider perspective at the (potential) negative impact companies have on society.
Slowly but surely we should start looking at the disadvantages to society’s ability to collaborate as well. By elaborating on the contours of the ideal electronic wallet – I dubbed it the “Utopia Wallet” – I postulated crypto currency will (have to) be part of it. The move of Apple directs in the wrong direction. For more on Bitcoin at Red Planet Dust: