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- Adult entertainment platform SpankChain had to close crypto payment processor SpankPay.
- Hostile banking scenarios are to be blamed for the situation.
The hostile banking environment claimed another victim when Ethereum-based adult entertainment platform SpankChain, halted SpankPay, after losing service provider Wyre. The ongoing antagonistic banking scenario creates more issues than it tries to solve, causing heavy collateral damage.
SpankChain, SpankPay and Wyre
The Ethereum-based SpankChain is an adult entertainment platform, and SpankPay was their crypto payment processor, providing services provided by payment service provider Wyre. In February 2023, it announced that Wyre had terminated their agreement to provide payment services to SpankPay, citing “violations of any third-party payment processor or network rules.”
SpankPay said in a March 20, 2023 report that Wyre supposedly targeted this shutdown as their new payment processor does not work with the adult business. However, SpankChain’s relationship with Wyre has been healthy and supportive, at least until now.
SpankPay facing Troubled Waters
The Ethereum-based blockchain, SpankChain, works towards helping content creators in the adult industry to remove certain third-party intermediaries, like traditional banks, which are known to have a bad history of conflict with the adult industry as financial institutions look at the industry through bad lenses and do not wish to be associated with them.
In July 2019, SpankPay was launched by SpankChain. It was an adult-industry-friendly payment solution that assisted adult entertainers and merchants in accepting cryptocurrency for their services. Adult entertainers and people associated with the industry often prefer anonymity for obvious reasons, especially when it came to payments.
Assurance from SpankChain
Even after the shutdown, SpankChain has assured users that their money is safe, and the team is working to get them back to their owners as soon as possible. Users are thus encouraged to create crypto wallets and explore personal financial sovereignty. The company continues developing and investing in products and services to advance the adult industry.
Banking Crisis and Crypto Industry
The recent banking crisis began with the collapse of crypto-focused Silvergate Bank, followed by Silicon Valley Bank and Signature Bank in quick succession. These collapses created a banking crisis, spreading panic worldwide about the impending global crisis.
Traditional banks were supposed to be working as a bridge between Centralized Finance (CeFi) and Decentralized Finance (DeFi), and recent collapses almost broke this bridge. However, due to increasing interest rates, banks struggle to survive.
The crypto industry also suffered; USDC, the stablecoin, lost its peg when its issuer Circle was known to have a $3.3 billion cash reserve in Silicon Valley Bank. Many crypto entities are now looking for banking partners as the already limited list grew even thinner after big players had to leave the arena.
Silvergate and Signature have become a structural part of the digital asset industry for the past few years, offering services to traditional finance and a speedy payment network for the crypto industry. The failure of these banks has affected the industry in a bad way.
Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
