OnlyFan’s Mistake Sparks New Opportunity for Web 3.0
Adult content, love, the rise of the internet, and what it means for Web 3.0
Hey all, Robin here—it looks like the rise of Web 3.0 just might be happening much faster than I was originally anticipating, and its rise reminds me quite a bit of the rise of the original internet.
OnlyFans’ choice to remove adult content has the potential to cause a ripple effect and lead to the mass adoption of Web 3.0 protocols, but before we cover that we should explain the situation at OnlyFans.
The Situation at Onlyfans
OnlyFans is currently having quite the struggle with its payment processors and raising money from investors—it appears these two issues are the main reason for removing adult content.
Firstly, the payment processors debacle is due to processors like Stripe and Mastercard feeling queasy at the idea of internet adult content containing children—it was recently exposed that Mindgeek’s PornHub was hosting content involving children.
Mastercard and Visa subsequently cut their support for the platform, and it appears that they’ve been pressuring OnlyFans to remove adult content or face the same consequences.
It is assumed that OnlyFans has some child pornography and that is severely turning off investors and payment processors. In turn, OnlyFans appears to be grabbing the sledgehammer and outright removing adult content.
Now onto the investors—OnlyFans has been trying to raise from investors since March, and it has been quite the uphill struggle. This is due to many investment firms having “sin” clauses that prevent them from investing in companies like OnlyFans that host adult content. This severely cuts down the pool of potential VCs that OnlyFans can raise from, and most firms appear to be outright ignoring them or doing any DD.
Why the Desire for Sex, Love, and the Desire to See Boobs Made the Internet What it is Today
Now, when people think about the internet as we know it today, they think of men like Tim Berners Lee, Marc Andreesen, Eric Bina, or James Clark, who pioneered the internet as we know it via Mosiac and Netscape, but an often overlooked aspect of the internet is a con-man whose desire to utilize a new technology for our most carnal desires changed the world as we know it.
This man’s name was Stephen Cohen, and he was an expert con-man who dealt in scamming horny men who wanted to find girls. This con was known as the Los Angeles Free Love Society—essentially, he made men pay for access to a list of phone numbers whom they desired, and he then got sorority girl’s names via a sorority party. After this, the man established a p.o. box for each of the girl’s names, and men just started sending checks over—the numbers were found not so long after.
It netted a young Stephen Cohen a small fortune.
Fast forward a few months and a blizzard hits Chicago on July 25, 1978 and would transform the world forever.
A young IBM programmer named Ward Christensen would spend his snow day working on a side project for a club he was a member of, the Chicago Area Computer Hobbyists’ Exchange or CACHE. Christensen had imagined a new way to change bulletin boards by putting it on the computer. At this time, the idea of any online community was non-existent and something out of people’s wildest dreams.
Most computers were the sizes of entire fridges. However, there was the S-100 microcomputer which was a personal machine that preceded IBM and Apple’s personal computers. Christensen found a way to connect the S-100 microcomputers together and he called it the Computerized Bulletin Board System or CBBS for short.
It was essentially a very crappy forum that only displayed text, but at the time it was incredibly revolutionary.
This system would eventually attract the attention of Cohen, who saw it as a new way to exploit this new technology with sex. In need of a new start, he spent the past decade going through several failed marriages and being a general scumbag to his family and society.
Once he read about its potential in a paper, he started a *new* Los Angeles Free Society on the internet, this time called the French Connection BBS. Most of the small communities on the network were just free services involving sci-fi and computer nerds who sought connection with like-minded individuals.
Cohen monetized his service and charged $18 a month to leave messages to each other based on sexual interest. His BBS didn’t discriminate anyone on the spectrum and just cared if they paid for a chance to get laid.
Cohen relied on “word of mouth” to promote the service, and even gave out free memberships to women since there were not enough women joining the platform. Things got so bad that Cohen had to create an account named "Tammy” to talk with some of the men. Essentially, Tammy would take the mens’ credit card numbers and checks which Cohen then sent to a variety of post offices.
While this was a scam and a scummy thing to do, Cohen was successfully the first person who pioneered online dating,and how to get people to spend money before the Internet was even invented by Tim Berners Lee.
Let’s fast forward to the early dotcom era in 1995 where a man named Ron “Fantasy Man” Levi and Seth Warshavasky helped popularize the internet. Ron Levi was known as the godfather of the online porn business. A natural hustler since 14, he made his first fortune in phone sex and used that money to build the first large network of adult content sites online known as Cybererotica.
A man with a penchant for innovation, Levi invented Affiliate Marketing (a type of advertising system that uses affiliates to spread the word of a product and said affiliates receive a cut), and the advertising system used on the internet today that’s used by some of the largest social media platforms in the world.
The other man was Seth Warshavasky, an autistic man with a large nose and a snorting tic. Warshavasky made his first fortune in his teens running a phone sex business in Seattle. He immediately started a new empire on the Internet called the Internet Entertainment Group. For the price of $1, users of Club Love could chat with naked men and women. At the time, this was completely unheard of—the Wall Street Journal even wrote a story on it calling it “huge” and “combining the interactivity of phone sex with the visuals of televisions”.
The first subscription business online was not to read media or receive groceries—it was to view boobs online of a stripper named Danni Ashe. Ashe launched her own fan site and charged $15 a month for customers to look at her boobs. The second online subscription business was The Wall Street Journal. Ashe would later end up making $2.5 million a year from her site and ended up using more bandwidth than all of central America at the time.
An article in the Journal combined Levi and Warshavasky’s experience in innovating porn and showed how they did more than just slap boobs online. They figured out innovations in internet marketing, laid down the foundation for internet advertising, created pop-up ads (for better or worse), subscription services, secure credit card payments, and live videos.
The stars align for Web 3.0
“This fast growing billion dollar industry will undoubtedly come with newer and better ways to help losers whack off.”
Humorist, Dave Barry, 1997
That same fast growing industry has been embracing Crypto since 2018 when Pornhub first announced that they would begin accepting cryptocurrency payments. Now in 2021, after Visa and Mastercard abandoned the platform, MindGeek’s PornHub only accepts crypto payments and ACH Bank transfers to pay for premium services on the platform.
Decentralized platforms and payment processors for adult content in crypto began to emerge around 2017. The largest and most utilized is Spankchain which is used by one of the largest adult creator economy sites online, JustForFans. If OnlyFans is really going to be stepping away from adult content, then it presents a massive opportunity for SpankChain to seize the market and do what the internet did to adult content.
Spankchain enables adult content sites to accept crypto payments, and makes it simple for models to track their earnings and earn a living using crypto and fiat.
Imagine all of the new users—they will need to use Consensys’s MetaMask wallets and get ledgers from Ledger in order to pay in crypto and get the services they want.
As I’ve shown you throughout the history of internet, adult content has always remained something of a “first step” for exponential technologies. While Crypto is currently just in coins like Bitcoin and is starting to see more and more usage of DeFi. I believe that Crypto and DeFi are just the first dominos in a long string of dominos with each domino presenting a larger opportunity than the last. The internet as we know it today was built from adult content, and I’m expecting that Web 3.0 will remain no different.
A new internet is just beginning to emerge, and it is time that you learn about it.
Thanks - great ovwrview. Does this mean we now need a “deep dive” into Spankchain??
Thanks for the history lesson. I am always interested in the 3.0 and Metaverse. As I take a deeper dive I am realizing there are so many avenues and we are just scratching the service. Since there is a whole realm of "Metaverse" tokens out there would you be willing to share some insight on how to evaluate them and understand their current and future values?
Keep up the writing and insight.