Financial deplatforming is a monster, long-term trend to watch over the next decades. Deplatforming happens with sex workers. It also happens in the US marijuana industry. It happens with perfectly legal political content.
The number of ways in which someone, somewhere will be offended by products or services for sale is growing, driven by a rapidly improving worldwide communication network and delivery system, and by people terrified of the change that brings.
The response by PayPal and many others has been to cut service. With each case, the circle of people finding themselves cut off from the traditional economy grows.
Bitcoin is often criticized for its lack of use cases. I find a very high correlation between the strength of this belief and lack of awareness of financial deplatforming in its many guises.
I've had several friends in the adult industry have their checking accounts closed at a several major banks as well. Traditional banking should definitely not be discriminating against fully legal activities.
Bitcoin isn't criticized for this being an invalid use case, because it's totally valid.
It's criticized because it's useless for this use case, people involved in this scene in practice don't care about it to any serious degree beyond it being a talking point, and because anything for legally working around financial deplatforming still needs strong interfacing with the rest of the system as well as compliance with legal regimes, which BTC has nothing to say on that.
In fact, you can make your own payments platform denominated in USD and that's as useful as BTC for legal activities. So why go through the extra steps?
Ask Julian Assange [1] how this works with political speech and journalism. Though I've probably provoked "the hate" by naming the major example rather than thought about the underlying principles and what's at stake.
It will be funny that, as with other technologies from the past, pornography will be the use case that will finally bring cryptocurrencies to widespread adoption in society
Bitcoin isn't a currency that can fix this. Bitcoin is either censorable (lightning network) or unaffordable when used heavily with slow confirmations and ridiculous fees.
The lightning network is a joke--a frankenstein "Engineering UI" layed over a system to route around bad development decisions re:block size.
Marijuana is separate from the deplatforming in the traditional sense because federal banking laws and the DEA's stubborn Schedule 1 tautology when it clearly has medical uses are to blame as opposed to uncooerced choices.
This is Big Brother type censorship. Anyone they disagree with will get shut out of Paypal, Banks, Credit Cards, etc.
There was Hatreon but Visa canceled their services for them.
I agree the porn industry is legal and nobody forces people to watch Pornhub, now I doubt the future of Pornhub. I don't use it but I support those who do under the freedom of speech.
Most of the marijuana industry is illegal in the US. States making it legal doesn’t change the Controlled Substances Act. As banking is federally regulated, banks don’t have the freedom to knowingly allow illegal businesses.
Porn however, is legal, and deplatforming a legal product/business is wrong in my opinion.
To be clear, I am not suggesting marijuana should be illegal at the federal level at all, only that it’s not inconsistent that a bank not serve those customers — after all they would then become criminals themselves by facilitating the moment of funds for a product that is illegal.
IRS treats Bitcoin as property. Accordingly, the recipients need to report every bitcoin transaction on Schedule D and calculate its cost basis ( appreciation or depreciation of Bitcoin). I am not talking about the reporting of the cumulative income, but the additional requirement of reporting of each Bitcoin payment or disposal. Say you received 0.0001 BTC held it for 5 days and then converted to USD. These are two taxable events, not one, with the requirement of calculating BTC appreciation between these two events. Now multiply this burden by every transaction.
In my opinion, IRS successfully killed BTC use in the US by treating it as property rather than currency (for currency FX, transactions under $200 are exempt from cost basis reporting on schedule D)
Whatever you might think of the various professions... As long as it is legal, it seems the major payment service providers should not pass on their moral code onto everybody else.
What's next? You get no water/power/whatever if you run a business that the service providers simply do not agree with?
A chilling effect on free speech. Real alternatives to paypal and credit cards need to enter the market.
It sadly looks like my favorite hope is still not ready, but I am hopeful that this is due to slow and careful development that will lead to a stable long term outcome. https://taler.net/en/faq.html
I'm surprised that people suddenly think that banks aren't greedy enough to profit from the porn industry!
Maybe the reason PayPal and so many other companies won't service adult industries is that there are laws that put them within arms reach of criminal liability?
On a related note, this reminds me of Operation Choke Point (2013-2017), where the DOJ harassed banks that did business with customers in legal, but "undesirable", industries [1].
There are plenty of porn friendly payment providers. They just cost a lot of money relative to "normal" merchants because of a few simple reasons:
1) Chargebacks -- people chargeback the shit out of these kinds of transactions. Significant other sees the bill, gets pissed / confused about the charge / whatever
and gets it charged back.
2) Fraud -- people use stolen CC's to pay for this kind of thing.
3) Porn operators are, as a whole, rather shady themselves and present their own set of risks to a payment provider. A lot of those chargebacks in #1 are actually valid chargebacks.
You could say "use bitcoin", which would solve the chargeback problem but do nothing for fraud and shady porn sites. If anything it would exacerbate the shady behavior because consumers would have no recourse against fraud.
In short, collecting payment for porn sites a tough, costly business.
Have worked in men's and women's porn. Women have this solved, all their porn is from Amazon. Historically don't chargeback so that hurdle never existed.
I wouldn't be surprised if more than half of Kindle revenue and certainly more than half of Kindle profits were just women's porn. Amazon occasionally has half-hearted crackdowns because some conservative finds it and complains.
These have existed for quite awhile. CCBill was the big player around 10 years ago. They take a slightly larger cut for the service relative to something like a Braintree or a Paypal.
Bitcoin isn't good for transactions. It's too slow, too cumbersome for he average consumer and its value fluctuates so much that you'd have to have dynamic pricing.
I love the idea of crypto currency and I really do think, one day, some form of it will be out future. But Bitcoin today just doesn't fit that bill at all.
I hate that any online company can set arbitrary Terms of Service which they know for a FACT I have not read (I didn't click) and then decide to pull the rug out from me at any time because of that.
These companies are seriously important in our lives. If you take away my payment source or my email or whatever you are potentially setting me on a path to ruin.
I don't know what the answer is but I do think these companies should be required to have an appeal process of some kind that's regulated. They have so much power.
Even if you did click to accept the terms of service, their server knows you probably didn’t read it. They know exactly how long it was between you being served the contract, and you accepting it.
Clearly if that time is anything under a number of minutes or hours you can’t possibly be agreeing to the contract and so they should be duty bound to refuse service.
I look forward to a test case where a judge rules a terms-of-service contract unenforceable because the vendor logged that I read it in 3.2 seconds and accepted that as me having read it.
Or maybe it’s time to start being that person again, who reads contracts slowly and in full before signing.
Perhaps an opportunity for Pornhub themselves to get into the payments business? I assume they have enough transactional volume and vendors to make it happen.
See, if you have zillions of dollars there all kinds of financial instruments that harm society (say, by reducing taxes paid), but any vice the little people can partake in, either as producers or consumers, well, we have to keep that on a short leash. Or kill it.
The financial industry's policies around sex and pot need a reboot. It's ridiculous what they're restricting.
Presumably there's a reason that payment processors have straight up ban customers instead of increasing fees to cover costs? I mean different industries already have different risk profiles and fees.
I can think of an analogy to interest rates, which vary tremendously depending on risk.
17 years ago, my business partners and I were approached by a porn website looking to get their website redone. (We didn't take the job, but it was an interesting meeting.) He said that his biggest problem was "refunds".
It seems it was a common thing for people to buy his service (access to porn), and then a few days later claim to the credit card company that it was an unauthorized charge.
He told a story of an irate wife calling him on the phone one day and demanding the charge be taken off her husband's credit card bill. She was insistent that there was "no way" her husband would sign up for a porn website. Well of course he did (or was it their son?). But he couldn't admit it to his wife. And so she called the office of the porn website to complain.
I'm sure that hasn't changed 17 years later. Credit card chargebacks must still be a huge problem.
Chargebacks make it a customer service nightmare. One of the highest refund rates that credit cards get, the highest incidence of actual fraud (charges that really weren't authorized), undisclosed recurring charges, etc.
Still, cutting off service to the models seems unfair. But refusing to deal with the websites themselves actually has underlying business reasons other than morality.
I have signed up for trials just because I wanted to grab a certain clip. And while I was in there I would download as much as I can and then cancel. And there is also that once you are done watching the last thing you want to do is watch more. And did I just pay for that? Wasn't worth it.
In a business like that it may be quite difficult to detect exploitation. If they don’t strive do a good job at it (which doesn’t especially align with maximizing revenue), PayPal’s decision may be hard to criticize.
There is an alternative called Liberapay[0] but I haven't tried it, so I can't vouch for it. There is also Flattr[1], but Flattr is more for small micropayments to show your appreciation for a project or piece of software (not to mention you need a Paypal account to cash out your earnings). There's also things like Buy Me A Coffee[2], but again, centered around small micropayments (I imagine these performers need more than a coffee, although when you have several fans buying you a coffee it's a good gig). Also: I'm surprised nobody is talking about Patreon[3] (Prolly against their terms of service too though)
[+] [-] aazaa|6 years ago|reply
The number of ways in which someone, somewhere will be offended by products or services for sale is growing, driven by a rapidly improving worldwide communication network and delivery system, and by people terrified of the change that brings.
The response by PayPal and many others has been to cut service. With each case, the circle of people finding themselves cut off from the traditional economy grows.
Bitcoin is often criticized for its lack of use cases. I find a very high correlation between the strength of this belief and lack of awareness of financial deplatforming in its many guises.
[+] [-] bcheung|6 years ago|reply
[+] [-] Daishiman|6 years ago|reply
It's criticized because it's useless for this use case, people involved in this scene in practice don't care about it to any serious degree beyond it being a talking point, and because anything for legally working around financial deplatforming still needs strong interfacing with the rest of the system as well as compliance with legal regimes, which BTC has nothing to say on that.
In fact, you can make your own payments platform denominated in USD and that's as useful as BTC for legal activities. So why go through the extra steps?
[+] [-] harry8|6 years ago|reply
[1] https://wikileaks.org/Banking-Blockade.html
[+] [-] xtracto|6 years ago|reply
[+] [-] paulddraper|6 years ago|reply
No firearms, firearm parts, or ammunition. [1]
[1] https://www.paypal.com/us/smarthelp/article/What-is-PayPal%E...
[+] [-] ericb|6 years ago|reply
The lightning network is a joke--a frankenstein "Engineering UI" layed over a system to route around bad development decisions re:block size.
[+] [-] Nasrudith|6 years ago|reply
[+] [-] dwighttk|6 years ago|reply
That's because it is still federally illegal
[+] [-] cable2600|6 years ago|reply
There was Hatreon but Visa canceled their services for them.
I agree the porn industry is legal and nobody forces people to watch Pornhub, now I doubt the future of Pornhub. I don't use it but I support those who do under the freedom of speech.
[+] [-] briandear|6 years ago|reply
Most of the marijuana industry is illegal in the US. States making it legal doesn’t change the Controlled Substances Act. As banking is federally regulated, banks don’t have the freedom to knowingly allow illegal businesses.
Porn however, is legal, and deplatforming a legal product/business is wrong in my opinion.
To be clear, I am not suggesting marijuana should be illegal at the federal level at all, only that it’s not inconsistent that a bank not serve those customers — after all they would then become criminals themselves by facilitating the moment of funds for a product that is illegal.
[+] [-] cft|6 years ago|reply
In my opinion, IRS successfully killed BTC use in the US by treating it as property rather than currency (for currency FX, transactions under $200 are exempt from cost basis reporting on schedule D)
[+] [-] basch|6 years ago|reply
[+] [-] linuxhansl|6 years ago|reply
What's next? You get no water/power/whatever if you run a business that the service providers simply do not agree with?
[+] [-] mjevans|6 years ago|reply
It sadly looks like my favorite hope is still not ready, but I am hopeful that this is due to slow and careful development that will lead to a stable long term outcome. https://taler.net/en/faq.html
[+] [-] yunesj|6 years ago|reply
Maybe the reason PayPal and so many other companies won't service adult industries is that there are laws that put them within arms reach of criminal liability?
On a related note, this reminds me of Operation Choke Point (2013-2017), where the DOJ harassed banks that did business with customers in legal, but "undesirable", industries [1].
[1] https://cei.org/blog/operation-choke-point-targets-porn-and-...
[2] https://reason.com/2014/04/28/doj-operation-chokepoint-and-p...
[+] [-] rpmisms|6 years ago|reply
[+] [-] jimnotgym|6 years ago|reply
[+] [-] spookthesunset|6 years ago|reply
1) Chargebacks -- people chargeback the shit out of these kinds of transactions. Significant other sees the bill, gets pissed / confused about the charge / whatever and gets it charged back. 2) Fraud -- people use stolen CC's to pay for this kind of thing. 3) Porn operators are, as a whole, rather shady themselves and present their own set of risks to a payment provider. A lot of those chargebacks in #1 are actually valid chargebacks.
You could say "use bitcoin", which would solve the chargeback problem but do nothing for fraud and shady porn sites. If anything it would exacerbate the shady behavior because consumers would have no recourse against fraud.
In short, collecting payment for porn sites a tough, costly business.
[+] [-] uberduber|6 years ago|reply
I wouldn't be surprised if more than half of Kindle revenue and certainly more than half of Kindle profits were just women's porn. Amazon occasionally has half-hearted crackdowns because some conservative finds it and complains.
[+] [-] TulliusCicero|6 years ago|reply
[+] [-] bproctor|6 years ago|reply
[+] [-] WrtCdEvrydy|6 years ago|reply
I had a buddy who nearly did a chargeback against a club that put "E 11 EVN" on his bill... name is Eleven Club.
[+] [-] emidln|6 years ago|reply
[+] [-] bena|6 years ago|reply
[+] [-] gnahckire|6 years ago|reply
[+] [-] hindsightbias|6 years ago|reply
[+] [-] noxer|6 years ago|reply
[+] [-] __jal|6 years ago|reply
That's called a hotel room.
[+] [-] scarface74|6 years ago|reply
[+] [-] egdod|6 years ago|reply
[+] [-] BinaryIdiot|6 years ago|reply
I love the idea of crypto currency and I really do think, one day, some form of it will be out future. But Bitcoin today just doesn't fit that bill at all.
[+] [-] spookthesunset|6 years ago|reply
How will you deal with fraudulent / sketchy site operators scamming people into sending them money via irreversible payment channels?
[+] [-] habosa|6 years ago|reply
These companies are seriously important in our lives. If you take away my payment source or my email or whatever you are potentially setting me on a path to ruin.
I don't know what the answer is but I do think these companies should be required to have an appeal process of some kind that's regulated. They have so much power.
[+] [-] gorgoiler|6 years ago|reply
Clearly if that time is anything under a number of minutes or hours you can’t possibly be agreeing to the contract and so they should be duty bound to refuse service.
I look forward to a test case where a judge rules a terms-of-service contract unenforceable because the vendor logged that I read it in 3.2 seconds and accepted that as me having read it.
Or maybe it’s time to start being that person again, who reads contracts slowly and in full before signing.
[+] [-] kreck|6 years ago|reply
https://medium.com/incerto/the-most-intolerant-wins-the-dict...
Private companies have no incentive to take a stand for individual freedom and will always bow before the demands of a (loud) minority
[+] [-] unknown|6 years ago|reply
[deleted]
[+] [-] mrandish|6 years ago|reply
[+] [-] magashna|6 years ago|reply
[+] [-] mbdesign|6 years ago|reply
Otherwise, I see DAI token being ideal for this coupled with locking your DAI in MakerDAO [2] to earn interest.
[1] https://spankchain.com/ [2] https://cdp.makerdao.com/
[+] [-] rhizome|6 years ago|reply
The financial industry's policies around sex and pot need a reboot. It's ridiculous what they're restricting.
"I Hope PayPal's Dick Falls Off" https://gizmodo.com/i-hope-paypals-dick-falls-off-1839870796
[+] [-] fowl2|6 years ago|reply
I can think of an analogy to interest rates, which vary tremendously depending on risk.
[+] [-] unreal37|6 years ago|reply
It seems it was a common thing for people to buy his service (access to porn), and then a few days later claim to the credit card company that it was an unauthorized charge.
He told a story of an irate wife calling him on the phone one day and demanding the charge be taken off her husband's credit card bill. She was insistent that there was "no way" her husband would sign up for a porn website. Well of course he did (or was it their son?). But he couldn't admit it to his wife. And so she called the office of the porn website to complain.
I'm sure that hasn't changed 17 years later. Credit card chargebacks must still be a huge problem.
Chargebacks make it a customer service nightmare. One of the highest refund rates that credit cards get, the highest incidence of actual fraud (charges that really weren't authorized), undisclosed recurring charges, etc.
Still, cutting off service to the models seems unfair. But refusing to deal with the websites themselves actually has underlying business reasons other than morality.
[+] [-] johnpowell|6 years ago|reply
Family Guy sums it up nicely.
https://youtu.be/IzhIiJJdD9g
[+] [-] gorgoiler|6 years ago|reply
[+] [-] cabaalis|6 years ago|reply
[+] [-] goblin89|6 years ago|reply
In a business like that it may be quite difficult to detect exploitation. If they don’t strive do a good job at it (which doesn’t especially align with maximizing revenue), PayPal’s decision may be hard to criticize.
[+] [-] dextralt|6 years ago|reply
>"Freedom of speech does not mean freedom from consequences"
>"en.wikipedia.org/wiki/Slippery_slope_fallacy"
Nothing is out of the order.
[+] [-] selimthegrim|6 years ago|reply
[+] [-] octosphere|6 years ago|reply
[0] https://liberapay.com/
[1] https://flattr.com/
[2] https://www.buymeacoffee.com/
[3] https://www.patreon.com/