I've suspected that the next place cryptocurrencies will see usage for actual consumer payments will be porn. It makes so much more sense than going through the suffocating mastercard/visa networks, and porn has historically been one of the industries most willing to try new technology.
I think their business model is like a gym - they need people making an effort to cancel, not to renew... Crypto works for one-time payments, but it sucks for recurring transactions. Too much hassle to pay every month, people would just give up.
It's a good point but worth noting that the Mullvad VPN (which, like porn, has a strong driver for privacy) recently got rid of susbscription payments altogther.
Their reasoning was that you can't handle recurring payments without holding a lot of personal data.
Perhaps porn sites that want to offer inter-species furry porn should bite the bullet and only accept one-off payments, just so they can make effective use of crypto.
Recurring payments should be initiated on the client side (or at your bank) anyways... Not initiated by the business you are buying from... That's a good way to get screwed.
With micropayments, the business model becomes (quite literally) pay-per-view.
> it sucks for recurring transactions.
The UX is bad at the moment, but with crypto there is this idea of "streaming payments", which work very well as a substitute for subscriptions. Basically, you make only one initial transaction to set up the "subscription" with a locked deposit. On every block (or on every X seconds if you are doing off-chain), a small transfer is made. You only pay gas if you need to "top-up" the balance or when you want to close the stream.
I can sign 12 transactions with my private key now and automate sending them out every month. If I don't want to be responsible for sending the transactions, a smart contract can do it for me. This can be abstracted away from the user and made as intuitive as any other payment flow.
There might be a smart contract that acts as a hot wallet where you fund once to authorize, and every month the contract owner/operator can withdraw X amount of Ether from your quota. They pay for the gas but if L2 is used and transactions are batched, that's negligible.
If your quota has insufficient Ether or you've deauthorized the contract, your "subscription" will be cancelled automatically.
I think recurring payments are a pretty good use case for smart contracts, you load up a wallet defined in the contract with some cash, similar to a prepaid debit card, then authorize scheduled payments specifying a recipient, a frequency, and an amount.
It’s not ideal for that type of derelict subscription business model (e.g. the gym), but neither are prepaid debit cards or virtual cards with predetermined spending limits, and they probably already contend with those.
That's a good point. I think other business models are possible, though, if less lucrative. One example is one-time payments to buy videos, or to tip an artist that you for some reason feel like tipping.
And if you're motivated to pay for porn, but not to give a site your driver's license like OnlyFans requires, crypto actually would be better for that.
Yes, but I would be willing to bet my bottom dollar if you actually sat these people down with a licensed clinician, you'd find a lot of mental illness. From what I've seen a lot of these people have some delusion, no matter how 'strong' or 'weak' that delusion is, that they've developed a 'relationship' with the creator, not realizing that almost no woman would ever seriously consider any of these men as a long-term... or frankly, even short-term... partner.
If there's one thing that evolutionary psychology has shown, it's that women's psychology for the mating market is not wired that way.
The article states that half of PornHub's revenues per year were coming from subscriptions. I would take that as some evidence that people are paying for porn.
In a lot of ways, crypto makes perfect sense for porn payments. The anonymous nature is most likely a value add for most porn subscription holders.
Sure but crypto is an order of magnitude more complicated to get going than using an existing cc. Most people don't already have a form of crypto payment at the ready when one hand is covered in lube and they just need to hit the "confirm subscription" button. I would need to do days of research before I could confidently buy porn with a cryptocurrency.
>Do people get credit cards just to pay to watch something online?
People already have credit/debit cards. That was my point. How else have people been purchasing internet porn for the couple decades prior to crypto taking off?
>With crypto is the same.
No, it's not because most people do not have the slightest clue how to set up a crypto wallet meanwhile are kind of required by society to already know how to use a credit/debit card to make purchases.
That's a very US centric mindset. Many people in Europe don't have credit cards, let alone developing countries. In countries like Argentina there could be more people with crypto wallets.
Also do you not realise this was the exact same argument against credit cards vs cash in the 80s? Do you not realise how technical adoption works?
Fair point, I didn't know that so many people hadn't yet adopted cards / e-banking. I understand that many people live in poverty without access to the internet etc but, surely online shopping is a global phenomenon-- you're telling me using bitcoin for online shopping is the norm in some countries?
It's from 2017, would be interesting to see if crypto has taken over so significanly since then.
Credit/debit apparently dominate in most parts of the world for online commerce, as well as other non-crypto mobile payment systems, like country-specific e-wallets (for example Yandex.Money in Russia).
30 million users is probably big in the crypto space but when talking about global populations it's not, so yeah, that's only a geeky niche and thus the assumption that the average porn watcher will most likely have a cc# (or equivalent non-crypto mobile payment) and have no idea how to set up a crypto wallet seems totally valid.
And this is just one crypto wallet, there are a handful of others too. It will probably slow during the crypto bear market, but that's insanely fast growth. I can see it being quite common for people to have either their own crypto wallet or one provided via their bank in the next decade. Having a browser plugin to pay for anything with one click (with 2FA for bigger purchases) is a much better experience than having to enter your credit card onto many different sites.
Nah, AFAIK ads pay very little for adult content websites, most websites now have a subscription based model and the possibility to buy additional content once subscribed.
As I understand it Mindgeek (Pornhub) makes about half their money from ads, but they are easily the largest advertiser in the industry. It seems likely that subscriptions/purchases still represent the majority of porn income.
> I've suspected that the next place cryptocurrencies will see usage for actual consumer payments will be porn.
It's been done, to various levels of success; it has it's humble beginnings with cam girls via BTC (look up Girls gone Bitcoin), and then as alts got traction post 2017 things like CUM (Cryptographic Ultra Money) [0] try to make headway but failed miserably as most alts usually do.
After Onlyfans threatened to take down all the adult content it had a real chance of making itself a MVP in this ecosystem, unfortunately these projects live and die based on short-term price swings and as you can see the value has made it essentially unfavorable for anyone but pump and dumpers.
I'd argue that BTC can and has shown more promise for sex workers, I've gone into detail about my first hand experience when in the early stage of my startup I interacted with the 'ladies of backpage' when Visa and MC shutoff access to purchasing ads on Backpage on here before. I just think that sex workers have enough on their plates that it shouldn't be this hard to just to solve something so trivial which many pay for, espcially if either Visa or MC want to be puritanical it.
They stopped being able to process credit cards because Mastercard and VISA cut them off when there was a public outcry about PH doing such a shitty job of moderating illegal content that everyone got the impression they were supporting it.
PH didn't decide "we are only gonna accept crypto so we can circumvent the system" it was a position forced upon them as a punishment for their shitty behavior. Now they are trying very hard to moderate effectively in order to win back the good graces of the payment processors because they are probably going to eventually go bankrupt if they don't.
Pornhub had a large blogpost claiming that thye are better at filtering illegal content than facebook, and that the latter has many times greater problems with illegal content.
the post claimed that Pornhub has been targeted because of their industry.
i have never verified the veracity of these claims, but they seem plausible
> Pornhub had a large blogpost claiming that thye are better at filtering illegal content than facebook, and that the latter has many times greater problems with illegal content
Facebook is also orders of magnitude larger and has to deal with content that blurs the line between legal and illegal. It's a significantly more difficult task.
They removed every single video they don't have a consent form for. You have to upload a consent form for every person in your video. Signing up to Pornhub as a model completely verifies your age.
From what I can tell they actually do more than anyone can expect.
I might not understand your question. I'm not saying the payment processors were wrong to blacklist them. PH was being genuinely scummy.
Its a forced position because PH very much wanted to continue to accept credit cards, which I suspect was where 99% of their income was from. However, the payment processors blacklisted them so they can't.
There are plenty of other industries which are just as high or higher chargeback risks and aren't forced through hoops. Gyms are a prime example. Food delivery has a high chargeback risk. Gift cards are a go-to for leveraging stolen debit/credit cards. You don't see the industry forcing regulations here, or forcing these industries to go through specific payment processors.
It also doesn't explain why porn actors routinely find their checking accounts closed out on them, or they get blacklisted entirely.
It has nothing to do with risk, and everything to do with Christian fundamentalists in the banking industry exploiting their positions in industries we need, to force their morals on others.
the problem with free market fundementalists is they deny that stereotypes, emotion and plain stupid decision making are often having greater effect than the hand and foot of the market
This just means the door is opened for a competitor that can provide the same or superior service at a lower cost. Free markets can have efficiencies, but they should be arbitraged away in the long run.
Usually the seller takes on short-term price fluctuation risk.
Buyer initiates purchase, and the seller gives them a window of x minutes to send y btc to an address, where the price of the service is denominated in btc as of the trading price at that moment.
If at least 1 transaction doesn't show up on the btc network in the x minutes, that transaction times out.
If at least 1 does, then the seller waits for w confirmations to take place before the payment is recognized as valid, where w is set to their tolerance. I've seen as low as 3 and as high as 7.
It relies on both those things, but both are decentralized. The first is handled by arbitragers who can mint/redeem it for other decentralized assets (it is fully collateralized by a treasury of decentralized assets).
The oracle is handled by Chainlink which is decentralized.
>The first is handled by arbitragers who can mint/redeem it for other decentralized assets (it is fully collateralized by a treasury of decentralized assets).
Sure, but the parameters of this mint/reward system are a function of the exchange rate, are they not? Even then, those decentralized assets are either other stablecoins, or non-stablecoins. If it's backed by stablecoins, then it's centralized. If it's backed by non-stablecoins, then it's non-stable.
>The oracle is handled by Chainlink which is decentralized.
You can't have a decentralized oracle in any meaningful way, it is like what truthcoin tried to do. I admittedly have no idea how chain-link works, but I am pretty certain that it is not decentralized. It is almost a truism that members of distributed system cannot verify arbitrary facts about the outside world (for example, exchange rates) without having trusted oracle/oracles. You can try to make the system reliant on many different oracles, but that is similar to classical consensus and there's no distributed way to prevent them from colluding. It is essentially the problem with proof-of-stake.
If you ask me, Fei looks like yet another ponzi system like USDT/LUNA. Why are stablecoin owners always rewarded for merely holding?
You've made a lot of assumptions that aren't true. Highly recommend actually researching them.
You can absolutely have price oracles of crypto assets without any interaction offchain, as you can use uniswap market prices and if they differ from any other exchanges arbitragers will make a profit by fixing that difference. But that is another oracle that is different from chainlink.
Chainlink is decentralized. It could possibly be attacked with enough effort and money to destabilize things but that is a totally different threat vector than the government restricting trading to services it doesn't like or censoring users.
Fei is backed only by decentralized assets.
UST was backed by nothing which is why it collapsed, Fei is over collateralized. You don't get any rewards for holding Fei.
Uniswap is only between cryptocurrencies. As I said earlier, those cryptocurrencies are either other stablecoins, or non-stablecoins. If it's backed by stablecoins, then it's centralized. If it's backed by non-stablecoins, then it's non-stable.
Chainlink is, from what I understand, a truthcoin-like system where oracles put down collateral. It is fundamentally a broken system because whatever group with the majority of the collateral just wins. What is stopping a government that can censor users and restrict trading from forcing oracles to collude and report false information?
You keep repeating that non-stablecoins make it non-stable but it doesn't actually make any sense. Fei is a stablecoin using non-stable assets, that is stable. All you need is a treasury bigger than outstanding debt. You're going to have to present better evidence than that.
I addressed your comment on Chainlink already, yes it could come under pressure or attack which would destabilize the network. This could be used to break many things, but it's not a vector for censorship / centralization because it has nothing to do with Fei's use as a currency and definitely doesn't make Fei centralised.
If it's backed by bitcoin for example, and you're trying to peg it to USD, then the spending power of your treasury in USD will depend on the price of bitcoin and the peg will just break when the price of bitcoin falls too far.
Fei's reward system is controlled by whichever party controls the oracles. You can outsource the oracles to a proof-of-stake-like system on chainlink, but that doesn't get rid of the fundamental problem.
I know of at least one sex-related forum that now supposedly requires btc to join. (This said, the related statement on the homepage mentions an absurdly high amount, probably set years ago and promptly forgotten...)
This would be a great time to reread the classic "Better Than Free" essay. https://kk.org/thetechnium/better-than-fre/ By my count, the average OnlyFans account absolutely nails 5 out of the 8 "generative" qualities that Kelly identifies.
> I've suspected that the next place cryptocurrencies will see usage for actual consumer payments will be porn.
If cryptocurrencies were useful for this problem, they'd have been adopted already. It's an sector whose businesses and workers are very savvy about anything that helps them evade repression.
This is maybe a tangent, but: how long before we're allowed to stop calling cryptocurrencies a new technology, and admit that actual usage is not being blocked on early development? Bitcoin itself is 14 years old; if it were a web framework, it would have been "obsoleted" half a dozen times over by now.
New is pretty context dependent. Money is literally older than history. That sets up a lot of context by itself, and further the fact that it's so important means people, governments and institutions are pretty conservative (in the slow to adopt change sense) about it. Banks have only recently reached infrastructure status in that context - and only in well developed nations. Credit cards are still new in that context (and it shows). The 14 years of bitcoin is basically embryonic in terms of "money tech".
Standardized weights of specie are older than history; you can find different perspectives on how much they count as "money".
But history begins at a time when the role of money in society is still very much up for debate; Hammurabi's code (~1000 years after the beginning of history, give or take) includes a provision specifying that, if you run a bar, you can't require customers to pay in silver but must also accept grain.
Grain as currency continues across the world for a few thousand years after that, but grain is a terrible currency because it spoils very quickly. (Counting things like "rats got into the grain" as a form of spoilage.)
This is a reasonable point, but it demands that we ignore the parabolic trend in every other aspect of human development. We've gone from horse-drawn carriages to moon landings and instantaneous global communication in the last 125 years; why does Bitcoin get over 10% of that time to do what I can already do with the piece of plastic in my wallet?
Depending how you define personal credit, its been around ~100 years (or more!), with the card format being adopted in the 60s. It's only been the last 15 years or so that not carrying cash has become a reasonable approach to day-to-day life.
So for bitcoin to become as big as it has as a brand new technology in only 14 years seems accelerated.
This is analysis complicated a bit by the fact that bitcoin is not a top-down tech like credit, there's no centralized group deciding who gets to use it. On the other side of that though - the tech infrastructure build-out that made credit cards ubiquitous also benefits and accelerates the potential adoption of bitcoin.
It's parabolic with respect to middlemen, but none of the other properties I care about. That isn't to say there are no advancements (I think privacy-preserving finance is an important frontier), but they don't stack up well, to say the least.
What you're saying clearly makes sense but Bitcoin isn't accepted almost anywhere which is what "new" means. Porn would be an early adopter for potentially mass consumption. It would be new to me certainly as I've never purchased a single thing with Bitcoin and that's almost certainly true for most people.
I don't know. I passed a bitcoin ATM machine (don't ask me what that actually means, please) on the street yesterday. Friends and family members, including (especially?) non-technical ones, have asked me about Bitcoin and how to invest in it. One of my friends recently bought a car with Ethereum.
"New" means "new," it doesn't mean "not widely adopted yet." We don't widely adopt things that fail or have unacceptable side effects; that doesn't make them new again.
I don't buy that. The Euro was conceived in 1992 and constituted a radical shift in international monetary policy; it wasn't fully rolled out until 2002.
That's 10 years compared to Bitcoin's 14, with arguably far more in concrete financial activity (and quality of life) to show for it.
Sure but again let's be a little more nuanced. When the Euro came out, trillions in wealth were automatically converted to it. Pretty apples to oranges comparison. If all USD was converted to BTC, BTC would become useful everywhere as fast as people could change the POS systems. Not a fair comparison at all.
> When the Euro came out, trillions in wealth were automatically converted to it.
This is true, but also misleading: the physical Euro switch took place over months, and involved a coordinated public campaign to encourage millions of Europeans to exchange their physical bills. Digitalization helped with banking, but a significant human and policy effort occurred in parallel.
And there's another problem: it's really not clear what it would mean for "all USD to be converted to BTC." BTC has already been issued, and will continue to be algorithmically issued. The Euro switch could not be economically triaged per se, because it was an in-kind transition. No such transition is possible for cryptocurrencies, unless we allow a central authority into the mix.
The euro is not a new type of currency tech. Its just a new painting on the same type of currency that has existed for hundreds of years (that is it's a new brand of banknote).
Not to put too fine a point on it, but my guess is there is probably little overlap in the Venn diagram of people paying for porn subscriptions and people capable of managing a crypto wallet.
The TL;DR is that blockchain scaling is a very difficult problem. There are scaling layers like ZKSync that are only possible because of cryptographic primitives that literally didn't exist in a usable form 14 years ago.
And I somewhat disagree with your premise – cryptocurrencies are actually used in the real world today. Most of the usage is to get around regulation, like when you want to send remittances or buy drugs, or bet on betting markets. But on the whole I do agree, it's disappointing that the technology is still so immature.
At this point, the fact that cryptocurrencies haven't successfully captured this markets tell us that they never will.
14 years ago the argument was "you just wait!"
Today, everyone in the US knows what "crypto" is, far more than know what "cryptography" is based on my casual conversations. The fact that porn hasn't moved to entirely crypto means that crypto has not survived the test of time.
There are plenty of other examples as well, the fact that Russian oligarchs (or even just regular old wealthy Russians) aren't creating massive demand for crypto to thwart sanctions is another example that crypto will never become an alternate, super-legal, currency.
It's honestly a shame that it doesn't work because, during the first wave of crypto hype, I rather liked the libertarian visions of an unregulated underground economy. I thought crypto enthusiasts were wrong then, but I at least hoped they were right.
The largest problem may be that doing the actual day-to-day work of regulation (vs. posturing, politicing, and passing poorly-written laws) is a [cough] pretty undesirable job.
I think that's probably true. Cryptocurrency has use cases in paying for drugs or illegal gambling. It will likely also have uses in paying for child pornography and other illegal forms of pornography. As usual, this is bad.
