Ethereum-Based SpankPay Shuts Crypto Payment Service
SpankPay, a crypto payment tool for the adult entertainment ecosystem SpankChain, has announced it is shutting down.
The payments processor and wallet alleged that it was a targeted shutdown by Wyre because of SpankPay’s line of business.
Failure to Secure Other Service Providers
SpankPay stated in a Twitter announcement that Wyre’s new payment processor does not support the adult entertainment business. In addition, the platform also mentioned that other service providers rejected SpankPay for the same reason.
The platform noted, “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.”
SpankPay partnered with Wyre as their payment provider and crypto custodian to honor all bank transfers made on SpankChain. Sharing a contract termination letter from Wyre, SpankPay said, “This came as a shock, seeing as our relationship with Wyre had been supportive and respectful up until this point.”
Meanwhile, it assured the users that the funds were safe and would be returned to their users.
SpankPay Troubles With Wyre
The adult content platform SpankChain has been built on Ethereum. Through SpankPay, it powered cryptocurrency payments, enabling blockchain to do away with third-party intermediaries and unfair payment practices in the adult industry.
Back in January and February, the adult payments platform had shut down withdrawals on the back of account closures by Wyre. BeInCrypto cited reports earlier this year that alleged that Wyre was going out of business. On the back of this, customers faced withdrawal limits. Several companies, like Juno and Ledger Support, confirmed payments with alternate partners amid the crisis.
Meanwhile, SpankPay is reportedly lobbying in Congress to prevent banks from discriminating against adult companies and performers. It noted in the thread, “With SpankPay being discriminated against due to the nature of our business, we’re as motivated as ever to end these extra-legal censorship practices enforced by financial institutions.”
According to Crunchbase, SpankChain secured $6 million in financing through an initial coin offering (ICO) in 2017.
Businesses Fail Amid Wider Weakness
SpankPay’s announcement is also accompanied by weakness in the broader markets. The failure of Silvergate, Silicon Valley Bank, and Signature came as the sector was beginning to recoup from the demise of FTX, setting off a domino effect in mainstream finance.
However, with the market capitalization of all cryptocurrencies hovering over $1 trillion over the past week, Bitcoin has recorded gains. BTC is trading between $27,500 and $28,000 at press time.
BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.