The announcement this week of popular London-based tech company OnlyFans banning all sexually explicit content as of October 2021 is a HUGE deal, and something that ought to concern us ALL.
Whilst OnlyFans, contrary to popular belief, isn’t just a porn site but a content platform open to all kinds of content creators, its largest revenue source is undoubtedly the 20% commission taken from sexual content.
So why would OnlyFans be digging its own grave and cutting in excess of 95% of its revenue stream?
The answer to that question comes down to the hold that payment processing companies Visa and MasterCard have over their operations and the complete dependance of either of these payment processing companies.
OnlyFans’ say that their decision follows threats by banking partners and payment providers to stop all payment processing to the company, which mirrors a previous decision by Mastercard to stand by Visa who threatened to do the same to MindGeek, the parent company of sites including PornHub, unless they removed all ‘unverified’ content from their platform.
MindGeek was accused of facilitating the posting so-called ‘revenge-porn’ and only after removing all unverified content, to satisfy both payment processing services, were they allowed to continue operating. It’s a similar story for OnlyFans after controversy surrounding allegations of underage sexual content being on their platform. Despite the company removing ’15 accounts’ suspected of containing such content, payment processing companies were not satisfied that this was enough, thus presenting an ultimatum – stop all sexual content, or get no money whatsoever.
I’m not defending either MindGeek nor OnlyFans. For the former, it should never have been within their business model to – whether inadvertently or not – allow for ‘revenge porn’ to be hosted on their platform and as for the latter, it isn’t long ago that the children’s commissioner Dame Rachel de Souza expressed deep concern after an investigation by the BBC found that under 18s have been able to use fake identification to set up accounts on the platform, thus clearly demonstrating that the platform’s security checks are not as stringent as they ought to be.
Setting aside the operations of both MindGeek and OnlyFans, the wider concern is the serious problems presented when in effect, payment processing companies are able to dictate which businesses exist – or don’t.
Whilst Visa and MasterCard are not the only payment platforms available, 50% of electronic transactions worldwide are processed through Visa, with MasterCard holding 25.6%, followed by UnionPay, Amex and JCB. In the UK alone, Visa holds a whooping 82% marketshare of payment card schemes, with 17% share going to MasterCard and the remaining 1% with Amex. With such dominance causing a reliance for both consumers and businesses, the problem presented is that these are private companies who can dictate how money is used and which businesses they are permitting you to transact with.
Binance, Kraken and Coinbase
In recent months, a popular surge of cryptocurrency in what is referred to as a ‘bull run’ has resulted in billions from fiat markets being transferred to and held in digital assets most commonly purchased through crypto asset trade platforms such as Binance, Kraken and Coinbase. There is an obvious correlation between a loss of confidence in traditional financial institutions and an increase in crypto investment, with the creation of Bitcoin, the father of cryptocurrency, originally being a response to the perceived untrustworthiness of traditional financial institutions.
Whilst the recent crypto ‘bull-run’ isn’t necessarily caused by a loss of confidence in banks, the growing interest in crypto is predominantly based on increased resentment towards the control that financial institutions have on our lives – and this presents a massive problem for banks who rely on ‘holding’ our money to stay in business – which is that – they don’t actually hold our money, but invest it into all kinds of shady schemes, lend it out and gamble it for profit, meaning that if everybody starts to withdraw their money into crypto, the scenes from outside Northern Rock during the 2008 financial crisis repeats itself, digitally.
In the UK, major banks including Barclays, TSB, Monzo, HSBC, Santander, Metro and others have responded by banning the sending or receiving of funds from crypto exchanges. They say that this is to “safeguard and protect customers” and prevent money-laundering and/or other criminal activity.
Crypto-exchanging can be a risky business and it has resulted in millions lost by consumers, whether through scams, bad investments or losing access to their assets. We also can’t ignore the problems surrounding crypto and the potential for criminals to benefit from the relative ease of laundering money and transferring victims’ money into untraceable cryptocurrencies.
However, there are crypto assets that may be a viable investment opportunity for consumers. Examples include Cardano, Ethereum and Binance Coin, all of which have real-use cases in the form of ‘smart contracts’. There are other investments too, such as VeChain, which is a supply chain tracking system with clients including BMW, PWC, Kuehne & Nagel and many others. Banks dictating where consumers and businesses can spend their money should be an uncomfortable position for all, particularly when considering the track-records of these banks, who rely heavily on taxpayer bail-outs when their shady investments go wrong but then choose to dictate what you can do with your own money.
Going back to OnlyFans and its content creators
There may well be examples of misuse of the OnlyFans platform, but it is important to remember that most content is indeed perfectly legal and therefore, an already stigmatised sector of workers face not only the prospect of lost revenue, but also of difficulties in the employment market due to the stigma associated with porn. This presents a huge dilemma for sex-workers and pornographic content creators on the OnlyFans platform who now need to seek out alternative platforms and re-establish themselves and rebuild their client base, facing the risk of being banned from those platforms too, following an unappealable, undemocratic decision taken by a private financial institution.
You may be thinking to yourself that the protection of children outweighs the impact on sex-workers, but flipping the example around to an industry more ‘acceptable’ in society, imagine the impact if financial institutions decided that they will no longer facilitate payments for alcohol or for certain foods. Taking things to an extreme, imagine if Visa and MasterCard decide (which, right now – they’re perfectly entitled) to no longer facilitate payments to independent high-street businesses because there are a few small businesses failing to pay adequate tax, are hiring people that Visa and MasterCard don’t agree with or that Visa’s directors have business interests in Amazon.
Of course this doesn’t negate the social responsibility of content platforms and social-media networks to mitigate the risks associated with abuse, but equally, the risks associated with the dictatorship abilities of financial institutions can not be ignored.
Crypto-assets and the future
There are at least three anonymous payment solutions that may be a viable solution to OnlyFans sex-workers, that is – ‘CumRocket’, ‘PornRocket’ and ‘SpankBank’. These crypto projects facilitate the exchange of payment through anonymous transactions of ‘tokens’ which can be swapped between crypto-assets (money) and non-fungible tokens (content). CumRocket, as an example, promises to charge significantly lower commission than OnlyFans’ 20% – something great for the content-creator, however, perhaps not so great for the future…
… It’s important to stress that I’m not accusing any of the three mentioned platforms above of facilitating abuse – both for legal reasons and also because I simply don’t know enough about them to offer that verdict, but it is important to consider the realistic prospect that when financial institutions do make decisions about how money is controlled, people inevitably find ways around this – and following the demise of OnlyFans, the floodgates are open to the potential for the gap in this market to be filled by service providers able to rely on the anonymity of crypto-asset and blockchain technologies, who may well decide not to have the same intention as OnlyFans to at least ‘try’ to mitigate the risk of under-18 content from finding itself on their platform.
Ultimately, a decision by private financial institutions to destroy an entire business which in turn will have devastating consequences for sex-workers, doesn’t actually mean that there will be a reduction in the abuse of online content-platforms – it just means that things go underground, causing an even bigger problem. For those who think I’m over-exaggerating and believe things won’t go underground – think for a moment what has happened following the criminalisation of cannabis – have people stopped using cannabis? – or are people now relying on dodgy drug-dealers who sell skunk as opposed to the real thing?
Crypto technologies exist for the very real problem of our reliance on financial institutions and banks and the ever-growing distrust towards them by the consumer. The behaviour of Visa and MasterCard towards OnlyFans is a perfect example citable by those in favour of deregulated cryptocurrencies, which, whilst great for breaking dependance and reliance – does open a can of worms and a future where legitimate and necessary cases for regulation is no longer even possible.
*Image credit: Forbes / Alamy