Apple might be looking to step into the world of Cryptocurrencies as they plan to let iPhone owners use their devices as hardware wallets that allow them to store and use bitcoin and other cryptocurrencies for transactions across the internet.
Amongst other announcements at Worldwide Developers Conference (WWDC) last week, Apple’s gathered attention with its new CryptoKit for iOS 13. Apple did not confirm whether Cryptokit is part of a plan to introduce a cryptocurrency wallet. However, It will supposedly allow developers to create hashes for digital signatures and provides public and private key management with the help of Apple’s Secure Enclave. It also provides support for transactions amongst users.
If Apple is going down the cryptocurrency path, it would be competing against HTC and Samsung, who already have their eyes set on crypto wallets in their smartphones. HTC’s Exodus 1 smartphone and Samsung’s flagship Galaxy S10 also look to bring in to native storage for Bitcoin and Ether cryptocurrencies.
A study from Juniper Research found that the number of people using digital wallets is expected to increase from 2.3 billion this year to nearly 4 billion by 2024.
According to David Huseby, a Security Maven at Hyperledger, the open-source blockchain project of The Linux Foundation, Apple’s CryptoKit is not featuring all of the cryptography algorithms including the secp256k1 signature algorithm, needed to complete Bitcoin transactions.
“However, the abstracted interface they created makes it easy to add other algorithms in the future,” Huseby said via email. “It’s the same strategy that Hyperledger Ursa has taken for making cryptographic algorithms ‘pluggable.'”
Hyperledger Ursa is a cryptographic library that can be used to easily create a layer of encryption with private and public keys to increase security for apps. In the same way, according to Apple, CryptoKit will give iOS app developers a new framework for hash generation to improve message authentication and key management.
Viktor Radchenko, the founder of Trust Wallet and Kyle Ellicott, Chief labs officer ReadWrite Lab, both backed Apple’s entry into the industry and is hopeful that it will rapidly increase the progression of the Crypto industry.
Ellicott said:
“They’ll be able to provide cold storage, or a more secure crypto wallet than anything else out there right now from a mobile phone standpoint. Look what else they talked about at WWDC. They announced the Goldman Sachs payments card and announced huge upgrades to Apple Wallet. People need to store [cryptocurrency] and they need to feel a level of comfort with that. Now with the Apple Wallet improving, and these partners using the technology, the next step is to integrate the two. As consumers, we know how to use the wallet; we feel safe because the partners are using as well.”
What this means for the existing market
Apple business partners, including Starbucks and Whole Foods Market, have all announced support for cryptocurrency payments for their products. A customer merely has to wave a QR code on their smartphone (generated by the app) in front of a register scanner and payment is transferred to the retailer. The QR code represents digital currency in a customer’s cryptocurrency wallet.
Ursa includes advanced cryptography features like zero-knowledge proofs for more privacy-oriented applications. Apple’s CryptoKit does not, Huseby said. CryptoKit enables a second layer of security through encryption for iOS applications with private and public keys, it helps combat hackers and their attempts for Sim Jacking. Both Ursa and Cryptokit aim to make this technology easily accessible to developers without worrying about underlying Cryptographic implementation.
Elliot added:
“It’s another layer of authentication and protection. That’s why it’s a bigger deal than Apple let onto. I don’t think they wanted to make too big of a splash because a lot of it came down to them not wanting to seem like they were creating potentially their own cryptocurrency like Facebook. We don’t know if they’ll have an Apple Coin. It would make sense based on their other strategies”.
“And, they don’t want to be the ones creating the next Coinbase. They want to empower Coinbase to leverage their technology to further integrate into the Apple ecosystem. That’s my interpretation of what I saw.”, Elliot Concluded.
Apple always has proved to be a quiet company when it comes to talking about future products and services as they like to have the surprise element when they eventually decide to announce the product. However, their sudden interest in blockchain related patents leads to more speculation regarding their eventual entry into the industry.
In February, Apple had announced it was helping draft blockchain rules for the Responsible Business Alliance’s Responsible Minerals Initiative (RMI). Apple also chaired the Alliance and served on the RMI steering committee during 2018 based on reports by VentureBeat.
Ellicott speculated that Cryptokit could potentially be hiding even more blockchain patents that will be eventually revealed as the product is made public.
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