SpankPay and the Current State of Adult Crypto
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 adoption 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 financial discrimination epidemic against professionals in the adult entertainment industry, enterprising and activist adult industry members have conceived ways to provide a secure transaction pathway without relying on the 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.Â
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 their 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, on allegations of fraud and breach of a contract in attempts to try and implement non-traditional payment methods on site.Â
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 made good on its support and failed to pay a sum that was said to be well over $4 million. VIT generated significant news, but the token has ultimately folded. This leaves only a few options in the space of adult entertainment 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 systematic banking discrimination against adult industry companies and professionals. Banking discrimination is a practice among the largest banking and financial institutions openly and potentially unlawfully denying 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 denying savings and checking accounts, bank loans, credit cards, and access to other payment processing services. Financial institutions may refuse to do business with adult industry companies and individuals 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 increased costs for financial transactions. 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 to condone financial discrimination against otherwise legal activity is potentially illegal. Office of the Comptroller of the Currency (OCC), an agency of the U.S. Department of the Treasury, regulates banking access and equity in the banking system. OCC mandates fair access. But, the so-called fair access rule is still on hold and is also considered extremely controversial.Â
But, the OCC and the financial services industry have to work together with the adult industry to solve 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 of the show, Bruce has interviewed numerous people in the industry on the subject of 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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