Cryptocurrency has been a hot topic in recent years, with its potential to revolutionize the way we think about money and financial transactions. But did you know that cryptocurrency is also being used to empower marginalized communities, such as sex workers who face financial exclusion? Despite their valuable contribution to society, sex workers often struggle to access traditional financial services due to stigma and discrimination.
However, cryptocurrency offers a way for them to not only receive payment securely and anonymously but also to gain financial independence and control over their earnings. In this article, we’ll explore how cryptocurrency is being used to support sex workers around the world, and why it’s an important tool in the fight for financial inclusion and empowerment. Let’s dive in!
Overview of the sex work industry and its financial challenges
Sex work is a controversial industry that has been stigmatized and criminalized in many parts of the world. Despite this, sex workers provide valuable services to their clients and contribute to the economy. However, due to the criminalization and stigma surrounding their work, sex workers often face financial exclusion, making it difficult for them to access traditional financial services. This exclusion can leave sex workers vulnerable to exploitation and abuse, as they may be forced to rely on cash transactions and unscrupulous intermediaries.
Crypto payment platform SpankPay shut down operations in March 2023 following a breakup with its key partner, payment infrastructure company Wyre. According to a Vice report, the SpankChain product tweeted the following in February, when Wyre decided to cut them off their payment rails:
Operating SpankPay in a hostile banking environment has always been challenging, but the escalating attacks have become untenable for our small team and the niche market we serve.
For many in the adult entertainment industry, crypto is the only choice to receive payment. Vice report also mentioned the case of Allie Eve Knox, a sex worker and SpankPay advisor who was allegedly kicked off every major payment platform in the U.S., including PayPal, Square, CashApp, Venmo, and others.
Many large banks, including Bank of America, refuse to host sex-related accounts of any kind, viewing them as possible exposure to liability for money laundering-related fines, civil or criminal lawsuits and reputational risk.
In addition to the challenges of financial exclusion, sex workers also face issues with payment security and privacy. Because of the nature of their work, sex workers may be reluctant to provide personal information to financial institutions or payment processors. This can make it difficult for them to receive payment securely and anonymously, leaving them vulnerable to theft and fraud.
Sex workers are no strangers to tech-based discrimination. The passage of SESTA/FOSTA in 2018, a bill intended to stop the internet from being used for sex trafficking, caused online platforms to ban harm reduction and anti-violence tactics that keep sex workers safe. Platforms such as Redbook that allow sex workers to advertise online and share tips on dangerous clients, were taken offline, forcing many trans women of color back onto the streets with no recourse against malicious actors.
Despite these challenges, sex workers have found innovative ways to overcome financial exclusion and gain greater control over their earnings. Cryptocurrency, for now, leads the way for sex workers to receive payment securely and anonymously, without the need for intermediaries or traditional financial institutions.
Cryptocurrency as a solution for financial exclusion in the sex work industry
Cryptocurrency is a digital currency that uses cryptography to secure transactions and control the creation of new units. Unlike traditional currencies, cryptocurrency is decentralized, meaning that it is not controlled by any government or financial institution. This decentralization makes it an attractive option for sex workers, who may be excluded from traditional financial services due to stigma and discrimination.
One of the key benefits of cryptocurrency for sex workers is the ability to receive payment securely and anonymously. Because cryptocurrency transactions are recorded on a blockchain, a public ledger that is transparent and immutable, they can be tracked and verified without the need for personal information. This means that sex workers can receive payment without revealing their identity or personal information, reducing the risk of theft and fraud.
Some sex workers have opted for alternative payment methods such as PayPal or CashApp, but these options are not without their own challenges. Many sex workers have reported being banned or suspended from these platforms due to their occupation. This leaves them with limited options for receiving payments and managing their finances. (Source)
In their acceptable use policies, Cashapp and Stripe bar transactions related to “adult content and services” and Paypal, which owns Venmo, prohibits “certain sexually oriented materials or services.” Unlike banks, payment processors will not always return a customer’s balance after closing their account.
On the other hand, cryptocurrency allows greater control over earnings for sex workers. Because cryptocurrency is decentralized, it is not subject to the same regulations and restrictions as traditional financial institutions. This means that sex workers can receive payment directly, without the need for intermediaries or third-party processors. This gives them greater control over their earnings and reduces the risk of exploitation by intermediaries.
Case studies of sex workers using cryptocurrency
While cryptocurrency is still a relatively new technology, sex workers around the world have already begun to adopt it as a means of payment.
A recent study found that 25% of sex workers in Australia use cryptocurrency, with Bitcoin being the most commonly used.
In Thailand, for example, sex workers are using cryptocurrency to receive payment from clients who are based abroad. Because traditional payment processors such as PayPal are not available in Thailand, sex workers have had to rely on intermediaries who charge high fees and may be involved in illegal activities. By using cryptocurrency, sex workers can receive payment directly from clients, without the need for intermediaries or traditional financial institutions.
Similarly, in the United States, sex workers are using cryptocurrency to receive payment securely and anonymously. Because sex work is illegal in many parts of the US, sex workers may be reluctant to provide personal information to traditional financial institutions. This can make it difficult for them to receive payment securely and anonymously.
Benefits and risks of using cryptocurrency in the sex work industry
While cryptocurrency offers many benefits for sex workers, it also comes with risks and challenges.
One of the main disadvantages is because cryptocurrency is not backed by any government or financial institution, its value can fluctuate rapidly and unpredictably. This volatility can make it difficult for sex workers to budget and plan for the future and can lead to financial instability.
Another disadvantage of cryptocurrency is the risk of fraud and scams. Because digital currencies operate independently of a central bank or financial institution, there is a greater risk of fraud and hacking. This can lead to the loss of funds for sex workers who rely on cryptocurrency for their income.
Despite these risks, many sex workers believe that the benefits of using cryptocurrency outweigh the challenges. By using cryptocurrency, sex workers can gain greater control over their earnings and reduce the risk of exploitation by intermediaries. They can also receive payment securely and anonymously, without the need for personal information or intermediaries.
Legal and regulatory considerations for using cryptocurrency in sex work
The use of cryptocurrency in the sex work industry raises legal and regulatory considerations. Here are some key points to keep in mind:
- Cryptocurrency regulations: Different countries have different regulations surrounding the use of cryptocurrency, and these laws are still evolving. It is important to stay up-to-date on the laws and regulations of the country or state where you are using cryptocurrency in sex work.
- Tax obligations: Cryptocurrency transactions may be subject to tax obligations, and individuals should consult with a tax professional to understand their tax obligations and ensure they are compliant with local laws.
- KYC/AML requirements: Cryptocurrency exchanges and other service providers may have Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements that individuals need to comply with. Failure to comply with these requirements may result in account suspension or other legal consequences.
- Privacy concerns: While cryptocurrency transactions are often touted as being anonymous, they are not entirely anonymous. Blockchain transactions are recorded publicly, which means that information about transactions can be traced back to individuals. It is important to take steps to protect one’s privacy when using cryptocurrency in sex work.
- Security risks: Cryptocurrency transactions are irreversible, and individuals need to take steps to protect their digital wallets from hackers and other security threats. It is important to use strong passwords, two-factor authentication, and other security measures to protect one’s cryptocurrency holdings.
However, despite these legal and regulatory challenges, many sex workers believe that cryptocurrency offers a way to gain greater control over their earnings and reduce the risk of exploitation. They argue that the use of cryptocurrency should be legalized and regulated, rather than criminalized, in order to ensure the safety and security of sex workers.
How cryptocurrency is disrupting traditional financial systems
Cryptocurrency is not just a tool for sex workers; it is also disrupting traditional financial systems and challenging the dominance of traditional financial institutions.
For example, the adult video cam streaming site Chaturbate, charges performers nearly half of their earnings to use the site, much higher than the 20% charge from OnlyFans. But Chaturbate offers a feature that many sex workers prefer; customers can pay in cryptocurrency and performers can cash out in bitcoin. The site still acts as a middleman, but at least its adult creators can choose their currency.
Because cryptocurrency is decentralized, it is not subject to the same regulations and restrictions as traditional financial institutions. This means that it can be used to bypass traditional financial systems and provide greater financial inclusion for marginalized communities.
Cryptocurrency is also challenging the dominance of traditional payment processors such as PayPal and Visa. Because cryptocurrency transactions are recorded on a blockchain, they can be tracked and verified without the need for intermediaries or third-party processors. This reduces the fees and costs associated with traditional payment processing and gives users greater control over their transactions.
How to Get Started with Cryptocurrency for Sex Work
Getting started with cryptocurrency for sex work is relatively simple. The first step is to choose a digital currency that is widely accepted and has a stable value. Bitcoin is the most popular cryptocurrency for sex work, but other options include Litecoin, Ethereum, and Tether.
Once you have chosen a digital currency, you will need to set up a wallet to store your funds. There are many different types of wallets available, including online wallets, desktop wallets, and hardware wallets. It is important to choose a wallet that is secure and reputable, and to keep your private keys safe to avoid the risk of hacking or theft.
Resources for sex workers interested in using cryptocurrency
If you’re a sex worker who is interested in using cryptocurrency, there are many resources available to help you get started. Here are a few options:
- The Sex Workers Outreach Project (SWOP) has created a resource guide on cryptocurrency for sex workers. This guide provides information on how to use cryptocurrency safely and securely, as well as information on how to comply with tax and legal requirements.
- The Crypto Sex Worker Outreach Project (CSWOP) is a nonprofit organization that aims to provide resources and support for sex workers using cryptocurrency. They offer a variety of resources, including a cryptocurrency guide, a directory of sex worker-friendly cryptocurrency exchanges, and a support group for sex workers using cryptocurrency.
- The Open Privacy Research Society is a nonprofit organization that provides privacy-focused technology services and resources to sex workers. They offer a cryptocurrency guide for sex workers, as well as a variety of other resources related to online privacy and security.
- The Sex Workers’ Rights Advocacy Network (SWAN) is an international network of organizations working to promote the rights of sex workers. They offer resources and support for sex workers using cryptocurrency, as well as information on legal and regulatory issues related to cryptocurrency.
- The Electronic Frontier Foundation (EFF) is a nonprofit organization that advocates for online privacy and free speech. They offer resources and support for individuals interested in using cryptocurrency, including information on how to protect your privacy and security when using cryptocurrency.
Websites such as Red Umbrella Fund and the Global Network of Sex Work Projects offer information and support for sex workers who are interested in using cryptocurrency. There are also online communities and forums where sex workers can share information and advice on using cryptocurrency.
Criticisms and controversies surrounding cryptocurrency and sex work
Despite the potential benefits of using cryptocurrency for sex work, there are also criticisms and controversies surrounding its use. Some critics argue that cryptocurrency is a tool for criminal activity, and that its use in the sex work industry could facilitate money laundering and other illegal activities.
Others argue that the use of cryptocurrency for sex work could increase the risk of exploitation and trafficking, as it may be more difficult to track and regulate transactions.
Conclusion: Potential for cryptocurrency to empower marginalized communities
Cryptocurrency offers a way for marginalized communities, such as sex workers, to gain greater financial inclusion and control over their earnings. By using cryptocurrency, sex workers can receive payment securely and anonymously, without the need for intermediaries or traditional financial institutions. They can also gain greater control over their earnings and reduce the risk of exploitation by intermediaries.
While the use of cryptocurrency in the sex work industry is not without risks and challenges, many sex workers believe that it offers a way to gain greater financial independence and control. As the use of cryptocurrency continues to grow and evolve, it has the potential to disrupt traditional financial systems and empower marginalized communities around the world.