SpankPay Adult Industry Crypto Payment Service is shutting down

Adult-themed payment service SpankPay announced on Monday that it would shut down after upstream payment processor Wyre Payments terminated its agreement with the company. Wyre cited “violations of third-party payment processor or network rules,” in February.

SpankPay claimed that the contract was severed.

“This was a targeted shutdown of Wyre because their new payment processor, Checkout.com, does not work with adult businesses,” the company tweeted. “This came as a shock, as our relationship with Wyre had been supportive and respectful up to this point.”

Spankchain, an adult industry blockchain, launched SpankPay in August 2019 “as a safe haven for our community”, allowing fans to pay for adult content instantly and discreetly using Bitcoin, Ethereum, Litecoin and Monero. The service later expanded to include other coins.

SpankPay has faced an uphill battle to find other service provider options to provide financial services to a business serving the adult industry.

“We’ve been looking for options since we got that letter,” SpankPay advisor Allie Knox told me Decrypt in an interview. “We looked for other payment processors and no one will take us, or if they do, their fees are crazy high.”

Knox says that while it is no longer possible to run SpankPay, the team will shift its focus to the other products and, more importantly, focus on changing the regulatory issues that cause this problem.

“We can build the technology, but it’s still a political issue,” Knox said. “It doesn’t solve these social problems, these political problems that are still happening. So we go to the root.”

The push for this legislative change began in December when Knox joined Spankchain founder Ameen Soleimani and a group of delegates from the Free Speech Coalition in Washington, DC, to meet with Democratic and Republican lawmakers about the discrimination the industry faces.

“Went to [provide] more education and teaching sex workers how to use crypto – we haven’t turned our backs on crypto at all,” Knox said. “We just need this shit to be fixed.”

The adult industry has a long history of conflict with the traditional financial system, forcing many – from individual content creators like Knox to entire platforms like Pornhub – to turn to cryptocurrency.

In December 2020, adult website Pornhub began accepting cryptocurrency after Visa and Mastercard blocked customers from using their credit cards to pay for the premium service. The decision came after the Canada-based company was the focus of a scathing article by New York Times which pointed out the presence of child pornography and sexual abuse on the site. Pornhub has since made significant policy changes to crack down on these videos.

“Running SpankPay in a hostile banking environment has always been challenging,” SpankPay tweeted. “However, the escalating attacks have become unsustainable for our small team and the niche market we serve.”

In the tweet thread announcing the closure, SpankPay said it is working to get users’ money to them as soon as possible, and encouraged users to create crypto wallets and “explore personal financial sovereignty.”

“As SpankPay is discriminated against due to the nature of its business, we are as motivated as ever to end these extra-legal censorship practices enforced by financial institutions. Thank you for being part of our community. The battle continues.”