Why Porn Might Just Be Crypto’s First Killer App

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@ daniel-jeffries Daniel Jeffries I am an author, futurist, systems architect, public speaker and pro blogger.

(NOTE: All links marked SFW and NSFW.)

What’s the killer app for crypto?

I’ve made the case for a decentralized WeChat in Gamifying the Delivery of Money but that’s just one possibility. There are so many ways this can go. It might be a small twist on an old favorite or something totally new and original. Yet the more I think about it the more I think I’ve overlooked the obvious.

There’s one primal human force that moves new technology like no other:

Sex.

Sex and tech go together like a magic stick and a love glove. Whenever new communications tech springs onto the scene it’s sex that makes it fly off the shelves.

Gutenberg’s filth enabling printing contraption.

Fifty years after Gutenberg gave us the printing press, Italian author Pietro Arentino (SFW) gave us dirty books. As soon as we had cameras we had porn. In 1874, a London porn purveyor got popped (SFW) by the vice squad with 130,000 nasty pictures.

But the history of sex and tech goes back much further. We tend to think of porn as some kind of modern invention.

Not true.

As soon as people could paint or sculpt they painted and sculpted people screwing.

We’ve unearthed erotic art from nearly every civilization that ever lived from the dawn of time.

The Greek Pottery Your Mom Never Wanted You to See

The Island of Lesbos depicted on some ancient Greek Pottery

Whether it’s the raunchy pottery of ancient Greeks getting it on (NSFW), the sex saturated temples of India (NSFW), the incredibly limber Egyptians (NSFW) going full Brazzers House on the Turin Erotic Papyrus (SFW), the spicy woodblock Shunga (“spring block”) prints of the Tokugawa era (definitely NSFW), or the Plum in the Golden Vase (SFW), a racy novel from ancient China, artists have always relished showing us in all our naked and acrobatic glory.

One of the oldest paintings ever discovered shows a psychedelic Dreamtime (SFW) mural on the ceiling of sprawling cave complex. 28,000 years ago the Aborigines proved we’ve always had love on the brain (NSFW).

It might seem strange to think of painting or sculpture as technology but that’s exactly what they are, analogue tech. Pens are tools. The invention of paper changed the very nature of the world allowing us to record thoughts instead of them dieng with us.

But tech is also about transformation and transmutation. The various ways artisans bend the material world to their will gave us the beautiful blue inks on Ming dynasty vases and the Porcelain of the vases themselves. Porcelain stands as one of the earliest composite materials (SFW) made from clay, feldspar, bone ash, quartz and more, all of it super-heated to thousands of degrees to transform it into something new and magnificent. It’s analogue tech at its very finest.

Over time societies’ embrace or suppression of sex waxes and wanes. It goes from closed to open and back again. But the burning desire for the flesh never changes. No matter how hard the powers that be work to crush our basic instincts the flame never goes out. Human nature always finds a way.

Actually the outright suppression of sex is a fairly new phenomenon. Early societies rarely treated erotic imagery different than any other imagery.

Queen Victoria was not a fan of the erotic arts.

You can blame the stick up their ass Victorians for ruining the party for everyone.

It wasn’t until the Victorian Era that we started to think of sexually explicit material as wicked and evil. Though many countries banned certain sex acts, merely looking at nudie pics didn’t become a capital offense until 1857 when the United Kingdom passed the Obscene Publications Act of 1857 (SFW) at the insistent urging of the buzzkill Society for Suppression of Vice (SFW). The Act banned the sale and distribution of porn and gave courts the power to seize and destroy it.

As the twentieth century dawned more and more countries took the anti-sex crusade to brand new levels, cracking down with ever more draconian measures from China’s Great Firewall which blocks millions of adult websites to India where it’s illegal to send naughty photos over WhatsApp (SFW).

But a funny thing happens when we push people too far.

For every action an equal and opposite reaction.

In the past porn was just another use case for new tech but as repression accelerated in the modern world, people quickly turned to technology to bypass the bans.

It wasn’t a desire for Western democracy that inspired young Chinese men to leap the Great Firewall with VPNs, it was JAV superstar Sola Aoi (SFW).

In the twentieth century porn didn’t just move markets, it made markets.

It started after World War II with 8mm home video cameras hitting commercial shelves. One of the biggest uses wasn’t filming lazy days at the park with the family or backyard BBQs it was filming people bonking. It didn’t take camera stores long to start secretly stocking “stag” films (SFW) which drove sales for movie projectors, screens and more.

In 1953 a young entrepreneur named Hugh Hefner spent his life savings, $5,000 bucks, to purchase pictures of the divinely nude Marilyn Monroe for the inaugural issue of Playboy. Years of battles with federal, state and local governments followed with the post office as the battleground. Obscenity laws stemming from the 1800’s made it illegal to ship smutty material through the mail. But in 1957 the Supreme Court ruled that Congress could only ban things “utterly without redeeming social importance.” Now men all over the states could finally read Playboy for the articles in the privacy of their own bathrooms.

The 1970’s saw the dawn of home video players and a clash of formats between Betamax and VHS. Betamax made for better quality but could only keep 60 minutes of video versus VHS which looked a lot worse but gave people three hours. Sony controlled the Betamax format and they made the critical mistake of refusing to allow any adult material on the platform.

The result?

By the end of the 70’s adult movies made up over half of video tape sales in the US (SFW) despite players costing a whopping $800 bucks.

Oh and Betamax was dead.

And of course we all know it’s not cats that really rule the Internet, it’s porn. Pornhub (SFW, yes really) alone “averaged 81 million visitors per day (28.5 billion visitors for the year) in 2017, with 24.7 billion searches. That’s 50,000 searches per minute, 800 per second.”

We’re already seeing the same kind of market making power for Virtual Reality, with expensive headsets like Oculus and Vive short on big budget games and world changing use cases but already seeing booming business with sites dedicated to getting up close and personal with your favorite adult icons (NSFW). Okoin already sees VR as the path to crypto porn glory, racking up $33 million (NSFW) to fund their decentralized web of VR sin.

But one tech that sex made mainstream stands out as our biggest clue that it might make for the perfect breakout app for crypto:

e-Commerce.

Pam and Tommy Lee

When Amazon was nothing but a glimmer in Jeff Bezo’s eye, Richard J. Gordon created one of the first electronic credit card systems in the 1990’s.

His earliest customers?

X-rated entertainment.

Gordon made a fortune taking commission from retailers big and small (SFW) including the mega-site ClubLove that published the infamous Pam and Tommy Lee sex tape in 1998 that everyone wanted to get their hands on.

Today those payment processors and the big adult sites have a stranglehold on the industry, charging outrageous fees that bite deep into entertainer’s pockets. Adult cam sites jack as much as 50% from popular performers. That’s worse than the top tax bracket in socialized France (SFW) and it means adult entertainers have to grind twice as hard just to get by.

Hell, there are loan sharks that charge less.

Spankchain logo on some undies.

Of course, many of today’s cryptos offer fees that just can’t be beat by today’s centralized competitors. SpankChain (SFW) wants to drop transaction costs from 50% to 5% and that means a lot more money in the pockets of all the adult superstars getting gouged today. They’ve already attracted a bevy of the adult world’s brightest stars as spokespeople (SFW) and so far looks like the one to watch in this space.

But another ubiquitous feature may just make porn and crypto a perfect match:

Privacy.

It’s one thing to put on a trench coat and slink over to the local adult theater in the rain but the VCR made it possible to see erotic entertainment right in the privacy of your own home. Credit cards made it easy to consume porn from afar but a damning list of transactions on credit card statements has gotten more than one husband in trouble with his significant other at the end of the month.

That’s why privacy focused cryptos like Monero, Zcash and ZCoin (all SFW) hold the powerful possibility of making up the backbone of all porn transactions in the future. Crypto payment channels layered on top of current mega-sites or new decentralized sex sites would dramatically reduce those loan shark level fees for good.

There’s another reason for adult businesses to move to decentralized payments as fast as possible:

Corporate morality clauses.

As adult superstar Janice Griffith writes in a blog post for SpankChain (NSFW — header image):

On the flip side, blockchains are open and agnostic. There’s no moral authority overseeing who gets to uses Monero and who doesn’t get to use it. That makes it a natural fit for an industry that faces high hurdles every time they want to set up shop.

But one time payments are just the tip of the iceberg.

It’s the programmable nature of crypto money and microtransactions that really opens up a wealth of new revenue sources for adult and mainstream sites alike.

Take advertising. Right now advertisements are a one way street. The advertiser pays a centralized site to jam his message down everyone’s throat with a very low return on investment. The best ads often get no better than a few percentage points of click through and conversion. People hate ads and the rise of ad blocking browser plugins shows us just how much we hate them.

When even Google, a business built on ad revenue, includes an ad blocker in its browser, you know the world despises in-your-face adverts.

But what if you got paid for your attention? What if you got paid to watch ads and your vote on whether you liked the ad actually mattered?

Today when you click an ad to say “don’t show me this anymore” it’s highly likely to show up again on your phone or Facebook feed anyway. Micropayments could flip all that on its head, which is the basic premise behind attention economy tokens like BAT. Reputation of ads held in decentralized Reputation Banks will matter more and more and only the best and most laser focused ones will ever get through.

Vice Token (SFW) already seems to have the right idea, billing itself as the coin that “pays you to watch porn.”

Micropayments like the ones proposed by Vice Token are impossible with fiat currency. The fees would kill any business and the centralized credit card companies would quickly cut off any company sending thousands of tiny payments per second. If you wanted to set up a site where you charged a small price for only the videos watched you couldn’t do it which is why big monthly subscriptions dominate the e-Commerce world.

That’s just one of thousands of possibilities for micro-payments.

A crypto focused site could allow people to pay only for the streams they want to see instead ponying up for an expensive monthly subscription. Another idea that springs to mind is paying for the exact amount of time spent with a cam star, whether that’s ten minutes or ten hours.

The Decentralized Sexual Revolution

The Summer of Love.

It’s impossible to know if any of the adult focused coins I highlighted here will win the day or if a universal payment system like Monero ends up as the default currency for tomorrow’s adult content fanatics. Maybe it ends up as a mixture of both with universal coins transparently buying smaller coins with atomic swaps in the background.

But there’s little doubt that decentralized platforms will prove irresistible to future porn lovers and performers alike. Whether that’s because of privacy, low fees or paying for only the content people want and nothing else, adult entertainment just might make the perfect proving ground for crypto.

Of course, what the adult industry pioneers today will swiftly end up in mainstream business models not long after.

And that means the old 60’s slogan got it all wrong.

The revolution will be televised.

Or at least streamed.

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