Blockchain technology has the potential to revolutionize the adult industry in several ways. One of the most significant benefits of blockchain is its ability to enable secure and anonymous financial transactions, which is particularly important in the adult industry.
Adult entertainment prides itself on being a leading and early adopter of privacy technology to mask the identities of online users – especially if the users are viewing otherwise legal adult content in jurisdictions where it is taboo.
Taking this a step further, the privacy and security of adult performers and professionals are just as important. Due to an ongoing epidemic of financial discrimination against professionals in the adult entertainment industry, enterprising and activist adult industry members have devised ways to provide a secure transaction pathway that does not rely on highly centralized financial systems.
The Case of SpankPay
One noteworthy attempt at beating financial discrimination in the adult industry was the creation of SpankPay. As Samantha Cole of Vice News explains, SpankPay provides payment services for SpankChain, an adult industry and sex-worker-led alternative to mainstream crypto exchanges. SpankChain was first developed in 2017, and SpankPay was launched in 2019 to beat discrimination.
However, SpankPay was dealt a blow earlier this year when they announced over Twitter that they had to suspend some services due to a targeted, discriminatory business decision adopted by some of their vendors. “Long and difficult consideration” is what led to SpankPay shutting down.
Another tweet in the same thread implicates the crypto on-ramp service Wyre and its payment processor, Checkout.com, for suspending SpankPay services because these companies and their ecosystems don’t work with adult-oriented businesses or individuals. SpankPay said this change was a “shock,” because SpankPay’s “relationship with Wyre had been supportive and respectful up until this point.”
The Decline of Adult Crypto
Vice Industry Token (VIT) was a blockchain-based token that was used to purchase adult content or interact with adult performers. However, the token busted. Playboy Enterprises sued the company behind VIT, the Vancouver, B.C.-based Global Blockchain Technologies, alleging fraud and breach of contract related to its attempt to implement non-traditional payment methods on site.
The Los Angeles Times also explained that the lawsuit claims Playboy Enterprises had reached an agreement for processing services. Playboy Enterprises said that Global Blockchain hadn’t fulfilled its support obligations and failed to pay a sum well over $4 million. VIT generated significant news, but the token has ultimately folded. This leaves only a few options in the adult entertainment space for crypto-based payments.
SpankPay’s unfortunate demise now turns the screws even more. In fact, pornstar Siri Dahl recently remarked at a premiere event for the Netflix exclusive documentary, “Money Shot: The Pornhub Story,” that SpankPay was one of the best types of alternatives to beat credit card companies and mainstream payment processors blocking out the controversial tube site after the publication of a one-sided investigative commentary on the cases of CSAM on Pornhub by controversial New York Times opinion contributor Nicholas Kristof.
Dahl tweeted: “At the [Netflix] premiere of #MoneyShotMovie, an audience member asked if any adult companies have tried crypto as a way to get around [Visa and Mastercard] payment limitations and censorship. The answer: Yes. And the best one we had, SpankPay, was just forced to shut down.”
This results from systemic discrimination in banking against adult-industry companies and professionals. Banking discrimination is a practice among the largest banking and financial institutions that openly and potentially unlawfully deny services to individuals or businesses involved in producing, distributing, or selling adult products or services, including internet porn.
Banking Discrimination
Discrimination like this takes many forms, including denial of savings and checking accounts, bank loans, credit cards, and access to other payment-processing services.
Financial institutions may refuse to do business with companies and individuals in the adult industry due to moral objections or concerns about reputational damage. This can lead to significant financial challenges for those working in the adult industry, including difficulty accessing basic financial services and higher transaction costs.
Some banks also place restrictions on the types of transactions that can be made by adult industry businesses, such as limiting the amount of money that can be deposited or withdrawn, or imposing higher fees for certain transactions related to porn and sex.
Banking discrimination in the adult industry is controversial, as it raises questions about freedom of expression and the rights of individuals and businesses to engage in legal activities. Some argue that financial institutions should not be able to discriminate against the adult industry, while others believe that banks should have the right to refuse to do business with adult industry professionals.
The sentiment that condones financial discrimination against otherwise legal activity may be illegal. The Office of the Comptroller of the Currency (OCC), an agency of the U.S. Department of the Treasury, regulates access to and equity in the banking system. OCC mandates fair access. But the so-called fair access rule remains on hold and is widely considered extremely controversial.
Conclusion
The OCC and the financial services industry must work with the adult industry to address this brazen financial and banking discrimination. Until then, crypto will persist. That is a good thing, but there is also a need for adjacent payment processing and financial technology providers to understand that adult entertainment companies aren’t illegal businesses and are entitled to the same access to banking and decentralized financial products – such as cryptocurrency payments.
One more note. On our podcast, Adult Site Broker Talk, Adult Site Broker CEO and host Bruce has interviewed numerous people in the industry about banking discrimination. Of particular interest are the segments with Mike Stabile and Alison Boden, both with the Free Speech Coalition.
Read More About Industry Rights:
- Nonprofits To Donate To As An Adult Site Owner
- Understanding Adult Industry Censorship On Social Media Platforms Like Instagram
- Debunking The Porn “Public Health Crisis”
- How Does FOSTA-SESTA Impact The Adult Industry?
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