In a recent development, Apple Inc. (AAPL) has denied approval for the newest version of Zeus, a non-custodial Lightning-powered bitcoin wallet, as per a Twitter post from Zeus creator Evan Kaloudis. This event follows hot on the heels of Apple's disagreement with another Lightning-powered bitcoin application, Damus, a decentralized social media platform that operates on the Nostr protocol (Nostr stands for "notes and other stuff transmitted by relays").
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Based on Damus's tweets, the bone of contention for Apple was Damus's "zap" function. This feature permits users to transmit small bitcoin amounts via the Lightning Network as a gesture of appreciation to preferred content creators, akin to the "tip" function of Twitter. The Lightning Network serves as Bitcoin's secondary payment network, allowing for cheaper and quicker transactions.
Apple has shifted its focus to Zeus, requesting the wallet’s developer to present necessary licenses and permissions to approve the transmission of a digital currency or risk being denied by Apple's App Store, as Kaloudis stated. It appears that Zeus breaches Apple's guidelines that mandate apps to furnish evidence of relevant licenses, like money transmitter licenses, to authorize the "transmission" of cryptocurrencies.
Many legal professionals concur that non-custodial wallets like Zeus, which don’t manage funds or private keys, should not be categorized as money transmitters. This label is typically meant for custodial wallets such as those provided by Coinbase and Binance that do handle customer funds.
Breez, another non-custodial Bitcoin wallet currently available in Apple's App Store, expressed through a tweet, "Non-custodial wallets should be approved." They highlighted a specific exception within the same section and pointed out the numerous wallets available in the App Store. The previous Zeus version is still available in the App Store, but the alterations made by Kaloudis in the new version remain undisclosed. CoinDesk tried to contact Kaloudis, Damus's founder William Casarin, and Apple for comments but received no responses at the time of reporting.
Subsequent to this, Damus consented to remove the zap button from all content areas. Apple allegedly views zaps on posts as equivalent to enabling digital content sales. However, Damus is allowed to keep the zap functionality on the profile level.
Whether Zeus and Apple will reach a compromise remains uncertain.
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