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Musk and Dorsey criticize Apple over its treatment of a social media app that allows bitcoin tips

Damus, an app that allows users to tip one another with bitcoin, says Apple asked it to change a defining aspect of its product.
An Apple store.
Marc Fernandes / NurPhoto via Getty Images

Major tech industry figures, including Jack Dorsey and Elon Musk, called out Apple on Tuesday after the social media app Damus said it was facing removal from the App Store. The high-profile scuffle is just the latest conflict between Apple and app developers.

Damus is an application that uses the open-source Nostr protocol, which is a technology that has been financially backed by Dorsey, who was a co-founder of Twitter and is currently the head of Block.

According to Damus, Apple zeroed in on a feature in the Damus app called “zapping,” which allows users to send monetary tips in response to posts made on the app, similar to liking things on Facebook. Users can “zap” one another small amounts of bitcoin on posts or on user profiles. Zaps have been praised in the Nostr community for allowing social media creators to receive compensation for content that often is posted for free on other platforms. According to Damus, Apple said the feature violates parts of its App Store Review Guidelines.

Damus said Apple was demanding the app remove its “zap” button on posts, because the company considers it to be “selling digital content.” 

Apple’s guidelines allow users to send monetary gifts without using in-app purchase, but they must meet specific requirements. Apple said gifts connected to receiving digital content or services must use the in-app purchase functionality. 

Apple charges a commission fee of up to 30% on in-app purchases of digital goods and services, according to a claim made by Musk.

Initially, Damus said, it was facing removal from the App Store in 14 days unless it complied with Apple’s regulations in that time. Damus shared screenshots Tuesday morning of a message from the App Store Review on Twitter.  

Later in the day, the companies had a scheduled call to “discuss the role of zaps in more detail,” Damus said on Twitter. Damus said Apple would still allow zaps on profiles but not zaps on posts, which would require Damus to change a core function of the app. 

Dorsey criticized the move, tweeting:“ This is still incorrect @apple. Tipping on posts is not selling digital content. It’s a form of feedback.” Dorsey also tagged Apple CEO Tim Cook’s Twitter account in the tweet. 

Dorsey added in his tweet aimed at Apple and Cook: “Why limit people sending bitcoin to each other? This is our one opportunity to build a truly global payment protocol for the internet (which would benefit your company immensely).”

Dorsey has been notably outspoken about his support of bitcoin, and many of the companies in Block’s portfolio have integrated features related to the cryptocurrency.

Other tech executives came to Damus’ defense and criticized Apple.

Twitter owner Musk tweeted: “If Apple competes against the whole world, Apple will have the whole world against it. This is not a winning scenario.”

Tim Sweeney, the CEO and a co-founder of the video game developer Epic Games, also criticized Apple, writing, “Apple is coming for money transfer and funding apps like Damus, Patreon, Venmo, maybe PayPal and Stripe.” Musk replied to Sweeney’s post with “Major concern.” 

Sweeney said in the tweet: “If digital goods may be somehow involved in the transfer, now they want 30%. If Apple can tax this, they can tax digital banking, payroll, and anything else.” 

Apple has a history of disputes with developers, including Epic Games, over its in-app purchase policies.