OnlyFans’ porn ban is crypto’s opportunity of a lifetime
Today, OnlyFans dropped the massive bombshell that it will be banning sexually explicit content" from the app later this year. This is obviously a wildly seismic shift for OnlyFans, which completely disrupted the adult content industry and gave performers a path toward greater independence by allowing them to connect directly with their fans via subscriptions. This shutdown is also the opportunity of a lifetime for the crypto industry which could capitalize on the shutdown and a recent wave of increasingly consumer-friendly crypto payments infrastructure products to create a platform that won't crumble under the influence of payment providers.
OnlyFans, which has been trying to raise at a unicorn valuation and running into plenty of trouble doing so despite huge revenues, didn't mince words on the reasoning for today's fundamental change. These changes are to comply with the requests of our banking partners and payout providers," a statement on the news from OnlyFans partially read.
Despite popular culture's ongoing destigmatization of sex work and adult content, banking institutions are still fundamentally conservative and wary to handle money flowing through these platforms. Most of the operators of these platforms are forced to deal with constant uneasiness of knowing their platforms might one day lose favor among these providers and instantly lose everything. All the while, vice clauses" present in plenty of venture capital firms' underpinnings keep them from operating in these spaces as well, and prevent these platforms from accessing growth capital. It's clear that adult content platforms are probably never going to have a friendly relationship with these financial institutions and it's likely time for the platforms - and the creators using them - to move on.
In a lot of ways, OnlyFans dumping porn seems like an outright betrayal of their creator network, and is something those creators will be sure to remember when embracing whatever copycats spring up in their wake. They are likely going to look at new platforms with renewed skepticism in how they'll handle payment provider standoffs, but there likely isn't going to be a different outcome for ambitious platforms looking to grow. That would likely be a different situation for crypto-native platforms, but given the tiny adoption, it's still a substantial risk for creators to embrace a platform on which their fans might not know how to pay for content.
The porn industry has been embracing crypto payments, albeit slowly. In 2018, Pornhub first announced that they would begin accepting cryptocurrency payments. Fast-forward to 2020, when Visa and Mastercard dumped the platform; now crypto payments and ACH bank transfers are the only ways to pay for its premium subscription service. There are already a few crypto platform players in this space, like CumRocket and SpankChain, catering to niche audiences (and probably in need of rebranding), but with the OnlyFans juggernaut out of the way, there might actually be a space for an existing or upstart player to innovate and capture this market.
The real challenge is in making it simple to onboard new users to both a new platform and potentially their first crypto wallet - while staying compliant with regulatory guidelines - at a time when more conventional web payment structures have gotten so streamlined and free adult content is just as prolific as ever. Know your customer (KYC) guidelines that push users to upload their passport or driver's license to verify crypto purchases probably aren't the easiest onboarding ask for a new crypto porn site, but as the market matures a bit and the challenges of a user setting up their first wallet are decoupled from the onboarding process for the platform, there are plenty of benefits to be realized.
Porn has always been a launchpad of sorts for new technologies. While the popularity of crypto has surged in recent months and nearly eclipsed $2 trillion in total assets, crypto penetration among the apps that people are actually using remains extremely low. As new solutions and startups pop up aiming to demystify buying and sending crypto, it feels like there's a chance the industry could be in the perfect place to fill the void left by OnlyFans' exit and build a more innovative platform in its image that goes all-in on crypto.
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