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Verge/Pornhub deal could show how to make money just by watching porn

Following porn’ technology before it goes mainstream has generally been a winning strategy

The price of Verge’s cryptocurrency () hit a 7-day low early Thursday morning following a much anticipated partnership with MindGeek, the parent company of Pornhub and YouPorn. Many adult film professionals sound equally unenthused about the prospect of accepting micropayments for work that once led to the laudatory title “Porn Star.”

Verge HODLers this week ended up in a common crypto trap as the announcement of a forthcoming announcement drove prices up. But after the announcement they fell by 25 percent. For alt-coin traders, the trend for 2018 has been simple: Buy the rumor, sell the news. On Thursday morning, the coin traded at $0.06, almost half of the $0.11 it fetched just before the announcement and a far cry from its January price of $0.26.

But if that sounds like underwhelming news, then imagine how it sounded to adult film industry professionals. Pornhub already gives their work away for free.

Gia Paige
Adult film actress Gia Paige.

“Sure those micro payments might add up,” said adult film actress Gia Paige to Modern Consensus. Grown adults who can talk about sex can choose her NSFW Instagram here. “But I make good money selling videos on my [very NSFW] site and on OnlyFans [on her equally very NSFW personal page] and they still tip me there. I don’t want to encourage free porn ever.” (Crypto-enthusiasts should note that even Paige’s payments facilitator charges a 25 percent fee.)

[Reporter’s note: Because we’re adults talking about the intersection of two different billion-dollar industries, we will refrain from making any porn puns or sex jokes in this story. We are professionals and this is our job. To get the facts straight in a mostly underground industry, I had to rely on the reporting of several mainstream news outlets. All of them were riddled with the same stupid jokes. If you want to watch journalists blush and make dumb jokes about subject matter a teenager could handle: please tune into your local news on Friday for 4/20. That said, feel free to share this on Twitter with your own bad jokes.]

Back to the story and how you can get rich by watching porn:

Montreal-based MindGeek does not publicly disclosed its market capitalization. However, its Dublin-based payments corporation reported earning $585,000 every single day in 2014 and 2015.

“Pornhub accepting Verge is a step, but with less people paying for porn than they did in the VHS vs Beta days, a platform like Twitch using crypto as their tipping system would have more impact as far as cryptocurrency being adopted by the mainstream,” said Nate “Igor” Smith to Modern Consensus. A photographer who has worked with Playboy and other adult magazines, Smith is a crypto enthusiast and early Verge investor.

Pornhub revolutionized the adult film industry by making free pornography easily available. Yet even with free video clips very accessible, the porn industry is, by some estimates, bigger than the NFL, NBA and MLB combined. And because most of the content uploaded on MindGeek sites is not from the copyright owner, the Verge announcement is like if Napster told bands in the early 2000s that they were done ruining their CD sales and were now ready to offer them micropayments.

The growth of Pornhub and its effects are brilliantly catalogued in Jon Ronson’s investigative podcast “The Butterfly Effect.” Listeners will take note that the company responsible for so much of the world’s pornography traffic is often first to move in a technological space.  Accepting subscriptions payments in the form of cryptocurrency is one step closer to a crypto-based ecosystem.

But as Ronson pointed out in his podcast: porn and technology meet on unequal terms. The German founder of Pornhub, Fabian Thylmann, financed his free site as a technology company with multi-million dollar banks loans, but many of the performers whose work appears on his site can’t get a mortgage because they work in the adult film industry. In 2012 80 percent of the people watching porn watched on Thylmann’s sites.

In a promo video released early Tuesday morning [Editor’s note: the older actor looks and sounds eerily like Sir Anthony Hopkins], Pornhub envisions an egalitarian subscription-based future where users can tip performers and even each other without throwing dirty money on the floor. The animation shows a user tipping dancers on a pole directly with cryptocurrency.

Indeed, the analogy to a strip club is quite fitting.

As noted to Modern Consensus by a former stripper at New York’s Scores club who went by the stage name “Mercedes,” many big strip clubs have their own internal token system with sizable fees. At Scores, a client can buy a lap dance on their credit card and pay a large fee. Then the dancer pays another fee to change the token into cash. A $100 lap dance would cost the client $120 and the dancer would net $86. However, the dancer would have to pay a “house fee” to Scores of anywhere between $80 and $200.

“Highway robbery,” opined Mercedes on the combined 34 percent charged even before the house fee.

So how does one get rich watching porn? By following the technology that appears in porn before it goes mainstream. They’re not always perfect, but they are scalable.

Adult-content boosters like to point out that so much technology—from Super 8 film to cable TV to VCRs to broadband and streaming services—first found a footing in the adult entertainment world.

This early adoption is always privacy-focused and so it makes sense that MindGeek would choose XVG for transactions. The coin began as a privacy-driven fork of Dogecoin—itself a novelty based on bitcoin—that did not record the users location or IP address. The transactions are public, but user details are not.

Cryptocurrency enthusiasts should also note that adult media often becomes the tiebreaker for technological advances. Adult content was the deciding vote in every advance in entertainment: VHS vs Betamax, BlueRay vs. HD DVD, 4K vs. UltraHD. It doesn’t matter which is better, it matter which one people use more.

Those holding onto other privacy-based alt-coins might have invested in the technology, but run head-on to the limits of crypto’s biggest asset and liability: utility. While there are other privacy-based coins—Bitcoin Private, PIVX, Zcash, Monero and Dash—Verge has emerged the winner this week, even if it shaved a few points off of its price in the process.

In order to thrive and move mainstream, the crypto world should focus on finding a niche somewhere in between unfettered free porn and subscription services.

“The future of porn is customization,” Smith said. “Bands don’t make as much money from music so they adapted by selling collectable vinyl or touring independently. Performers have a tough time accepting payments. Companies like Paypal or Square say they don’t want to be involved in sex trafficking, but really they’re worried about getting costly chargebacks.”

Smith thinks that crypto and porn can work together, but industry people aren’t keen on Pornhub. “The most logical place for crypto is [live camera adult sites] Chaturbate or MyFreeCams. They already have a tipping system in place but a lot of people don’t want it showing up on their credit card statement. A crypto exchange would neutralize that.”

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Brendan Sullivan is a writer, producer, and author of the memoir Rivington Was Ours: Lady Gaga, the Lower East Side, and the Prime of Our Lives. Disclosure: he owns cryptocurrencies. Follow him on Twitter.