So much for mining for cryptocurrencies on your iPhone. Apple Inc (NASDAQ:AAPL) recently updated their iOS guidelines to ban cryptocurrency mining apps from the App Store, meaning that the era of iPhone cryptocurrency mining, however small, is now officially over.
Mining for cryptos was never meant to a smartphone activity, and the thought of iPhone cryptocurrency mining might make actual crypto miners laugh. Nonetheless, the news is material because it is part of a broader trend wherein big tech companies are taking action against cryptos.
A few months ago, Facebook Inc (NASDAQ:FB) blocked cryptocurrency and ICO (initial coin offering) ads on its platform. Alphabet Inc (NASDAQ:GOOG) followed suit shortly thereafter. Twitter Inc (NYSE:TWTR), too.
And now, Apple is prohibiting cryptocurrency mining apps from appearing in the App Store.
All together, if you own a smartphone, your exposure to bitcoin and the cryptocurrency world has been significantly reduced over the past several months. And it’s only getting smaller.
That is bad news for bitcoin prices, which fell below $7,000 recently and keep making new 2018 lows.
What is next? Nothing good for bitcoin.
Here’s a deeper look.
Big Tech Is Winning Against Cryptos
The iPhone cryptocurrency mining ban affirms one big thing about the big tech versus cryptocurrency battle: big tech is winning.
Everything is going mobile. That mobile shift means consumer eyeballs are glued to smartphone screens. Formerly, those eyeballs were being swamped with everything cryptocurrency.
But not so much anymore. Facebook. Instagram. Twitter. Google. YouTube. LinkedIn. These are all apps which have now banned cryptocurrency advertisements, meaning unless a friend is posting about cryptos, consumers aren’t getting exposure to bitcoin and other cryptos through these apps.
And considering Google Google search interest in bitcoin has dropped like a rock since late 2017, it doesn’t look like social media users are posting about cryptos in any great frequency.
The iPhone cryptocurrency mining ban will only drive consumer awareness and interest lower.
This drop in consumer awareness and interest is a big negative for cryptocurrency prices. Cryptocurrencies have no value, other than the value consumers attribute to them. From this perspective, awareness and interest are everything.
The more consumers are aware and interested, the more they speculate, and the higher the value goes. But the less consumers are aware and interested, the less they speculate, and the lower the value goes.
That is why the rise and drop in bitcoin prices has almost perfectly correlated with the rise and drop in bitcoin search interest.
Unfortunately, with big tech making big moves against cryptocurrencies, it doesn’t look the drop in consumer awareness and interest is going to stop any time soon.
Fall in Love with Decentralization, Not Bitcoin
I’ve written about this several times before, but the true growth narrative underneath all this cryptocurrency hype isn’t bitcoin. It is decentralization.
An iPhone cryptocurrency mining ban can be materially negative for bitcoin prices. But it does nothing to the real growth narrative here. Decentralization is a powerful trend that came to existence long before the bitcoin bubble formed, has thrived while the bitcoin bubble has popped, and will continue to pave the path for the future while bitcoin becomes a tale of financial euphoria.
When I say decentralization, I mean the trend of taking power from the few, allocating it to the many, and creating a system which results in positive financial and social outcomes for the masses.
Think Uber (taking from power from the taxi services and giving it to anyone with a car).
Or think Airbnb (taking power from hotels and giving it to anyone with an extra room), YouTube (taking power from Hollywood and giving it to anyone with a camera and a personality), Instagram (taking power from models and giving it to anyone with photogenic qualities), and Shopify (taking power from huge commerce companies and giving it to start-up retailers).
In each of these scenarios, the masses win both socially and financially. In the case of Uber, riders get enhanced ride convenience, while drivers make money. With YouTube, consumers get to watch a bunch of entertaining content for free, while YouTube stars make money. Same thing on Instagram.
This is the future. Not bitcoin. So don’t fall in love with buying the dip in bitcoin. Instead, fall in love with buying into the secular growth narrative that is decentralization.
Bottom Line on iPhone Cryptocurrency Mining
Apple’s iPhone cryptocurrency mining ban is yet another big move by big tech to quell bitcoin mania.
Those moves are working, and will continue to work into the foreseeable future. That is why buying the dip in bitcoin is a dangerous game.
Instead, investors should look bigger picture, and consider investments in companies built on decentralization principles.
As of this writing, Luke Lango was long AAPL, FB, and GOOG.