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Apple faces lawsuit over alleged anti-competitive agreements and crypto restrictions in P2P market

The lawsuit's plaintiffs include Venmo and Cash App users who have paid inflated fees due to Apple's anti-competitive trade agreements

Shashank Bhardwaj
Published: Nov 21, 2023 02:31:00 PM IST
Updated: Nov 21, 2023 02:44:14 PM IST

Image: ShutterstockImage: Shutterstock

On November 17, a lawsuit was filed in a California District Court against Apple, alleging that the company entered into anti-competitive agreements with its competitors in the iOS Peer-to-Peer Payment (P2P) market, causing consumers to pay “rapidly inflating prices.”

The lawsuit claimed that Apple entered into agreements with PayPal's Venmo, Block's Cash App, and Google's Google Pay to restrict the use of decentralised crypto technology in their payment apps.

The lawsuit was filed by four consumers. They represented Venmo and Cash App users who paid inflated fees due to Apple’s trade restraints across the iOS P2P payment market. They alleged that Apple had violated the US antitrust law by entering into such agreements with its competitors.

The lawsuit filing read, “These agreements limit feature competition—and the price competition that would flow from it—marketwide by barring the incorporation of decentralised cryptocurrency technology within existing or new iOS Peer-to-Peer Payment apps.”

Further, the lawsuit claimed that because Apple uses technological and contractual restraints to exercise unfettered control over every app installed and run on iPhones and iPads, it demands the same agreement from any new iOS P2P payment product as a precondition for entry.

The lawsuit filings highlighted that Apple Cash, Venmo, and Cash App have continuously raised transaction and service fees in recent years without sacrificing market share. No new entrant has stepped in to constrain these prices.

Moreover, Apple has removed any new decentralised blockchain-based P2P services from its platform that had attempted to introduce new features and competition in the market.
Due to such unethical practices, the lawsuit plaintiffs have demanded that Apple stop entering into anti-competitive agreements with P2P payment rivals and future entrants. Additionally, Apple must separate its Apple Cash business from its other operations to prevent further harm to consumers in the P2P payments market.

This lawsuit adds to Apple’s growing list of antitrust lawsuits. The tech giant is already facing legal challenges related to anti-competitive practices in its Apple Pay service. In that case, the plaintiffs — a class of credit unions and financial institutions — have accused Apple of violating the federal antitrust law by monopolising the American market for tap-and-pay wallets in iOS devices.

The lawsuit is a significant development in the ongoing debate over the future of crypto and mobile payments. Its outcome could significantly impact consumers, businesses, and the crypto industry.

The writer is the founder at yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash