The US sued Apple over ‘shapeshifting’ laws that banned crypto apps and others.

The US Department of Justice has sued tech giant Apple for a wide-ranging antitrust lawsuit over its app market rules and “monopolies” that illegally stifle competition and stifle innovation.

The March 21 complaint in New Jersey federal court — supported by 16 state attorneys general — alleges that Apple has monopoly power over the smartphone market, which Apple has used to force developers to use its payment system to lock out developers and consumers. It's a stage.”

Apple's App Store guidelines and developer agreements impose a series of shape-shifting rules and restrictions that allow the company to “charge higher fees, stifle innovation, provide less secure or broken user experiences, and shut out competitive options,” the DOJ alleged.

The issue may be the reason why many crypto-based applications today offer limited functionality on iOS devices.

“Apple's anti-competitive behavior not only restricts competition in the smartphone market, but also reverberates across industries affected by these restrictions, including financial services.”

Apple's policies eliminated alternative payment systems that were “counter-competitive and exclusionary,” the DOJ said.

It also highlighted Apple's 30% tax — a fee the company charges for apps and in-app payments that “didn't create the content, product or service.”

The Pay and Apple Pay systems are only fiat-compatible and have banned the use of crypto in apps or made it economically viable for a crypto-based app to offer in-app purchases.

Apple offers “certain enterprise and public sector customers” the ability to offer their own apps through custom app stores, but iPhone users and developers are limited from such alternative app stores as they compete with Big Tech's fee-based app stores, the DOJ said.

“Apple often enforces its App Store rules arbitrarily. And it frequently uses App Store rules and restrictions to punish and restrict developers who use technologies that threaten to disrupt, diversify, compete or erode Apple's monopoly power.

Some non-vulnerable token (NFT) marketplaces, such as OpenSea, have discontinued functionality on their iOS apps as NFT sales are subject to a 30% fee.

Bitcoin (BTC)-friendly social app Damus also had to kill the BTC tip feature after Apple canceled the app because the in-app payment functionality didn't carry over.

Web apps — based online, in a web browser, and outside of the app store — are still under Apple's control because the company requires all iOS web browsers to use the WebKit browser engine.

Related: Apple is ready to bring Metaverse mainstream and dominate the market.

The DOJ also alleged that Apple prevented competing digital wallets that offered “improved features” and prevented developers from offering their own payment services to their customers.

An Apple spokesperson told Cointelegraph that the DOJ's complaint is “false in fact and in law, and we will defend it vigorously.”

Apple said the lawsuit “sets a dangerous precedent” because it could empower the government to “take a heavy hand in designing people's technology.”

EU digital market law forces Apple to offer alternative browser engines, payment functions and app stores, although the company still has an approval process saying the new options threaten user privacy and security.

Shares of Apple ( AAPL ) fell 4% on the day to around $171 and were flat in after-hours trading, according to Google Finance.

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