Hacker News Reader

Comment by codetrotter | Hacker News Reader

The adult industry should adopt Bitcoin

I can't pay my accountant, utility bills or my property taxes with Bitcoin though. At some point that money needs to be converted to fiat which means I still need a commercial account. And to maintain a commercial account in current year, "Know Your Customer" regulations force the bank to ask you an insane amount of details about your business activities and cash flow.

Even if they didn't, bringing in $120k / year into the account from a crypto exchange would raise a lot of questions and that, in and of itself, would likely get branded "high risk" by the bank since there is a perception that 100% of Bitcoin activity is money laundering.

> there is a perception that 100% of Bitcoin activity is money laundering.

Let us know what bank you're using so we can avoid it.

You could have an old school exchange where people go in person to shout bids and offers and settle with briefcases full of $100 bills. Those can be used to pay accountants, utility bills and property taxes.

Accountants have KYC and AML obligations too. Briefcases full of cash are not going to sit well with a legit accountant (and a non-legit accountant is worse than none).

I get it, some people want cash as a concept to be illegal. But we are not there yet. If you have all your receipts in order then using cash is fine.

It you live in a big city, it's easy enough to find someone to meet in person and exchange crypto for $1-10k cash a few % below the market rate. Some will even pay above market rate if you can do $100k+.

Facilitating (likely) money laundering isn’t really a great idea

> it's easy enough to find someone to meet in person and exchange crypto for $1-10k cash a few % below the market rate. Some will even pay above market rate if you can do $100k+

In case anyone is wondering, this is money laundering, and if you wind up with the wrong person on the other side, getting arrested and charged is among the better outcomes.

At least with respect to US federal money laundering laws (18 USC 1956, et seq.), there needs to be “specified unlawful activity”, as defined, involved for it to be money laundering.

Running a legal porn site isn’t illegal.

I think what they are saying is that the counter-party in the in-person BTC/USD trade could have gotten those USD in an illegitimate way, and that by accepting those USD in exchange for BTC you’d be partaking in money laundering.

Is there really a legal responsibility placed on an individual selling BTC for cash to verify the source of funds?

I assumed that wouldn't be necessary if not operating like a business with the intention to turn a profit. If I sold my car for cash, would I have the same responsibility?

> I can't pay my accountant, utility bills or my property taxes with Bitcoin though.

If you get Bitcoin in, and then you convert it to USD, why not?

The answer to this question is in the message you are replying to. At the end of the day there is still a bank with KYC requirements.

> At some point that money needs to be converted to fiat which means I still need a commercial account.

And where are those USD going to be stored?

In what way would that help? At the end of the day the company will need to pay taxes and employees will need to be paid (who in turn also need to pay taxes on that). That basically forces conversion to fiat via a bank account that they cannot obtain.

All crypto has done is add an extra layer of complexity on top of the fundamental problem.

> All crypto has done is add an extra layer of complexity on top of the fundamental problem.

In the West - maybe, but check pornolab.net - they are asking for crypto donations right now. They can’t get anything else (but for a different reason) but they can make use of crypto.

Yes, adopt a crypto currency that one day is worth 45k, and a month later it's worth 30k, and a month after that it's worth 20k, and 2-3 months later it's 15k (that's what happened in the second half of 2022)

You would need to hire a crypto savvy trader to distribute your risks over several currencies and exchanges.. and when you reaches $250,000 in valuation (which hopefully the employee tells you it is), you need to hire a second to make sure it all doesn't disappear in an uninsured irretrievable early retirement package for the trader.

You basically have to set up a crypto business along with your actual business idea... Compared to traditional small business where you can hire an accountant to do payroll for just a few hours, and you have next to no risk your accountant can easily run off with millions of your dollars that you can't get back.

Yep. The ability and willingness of banks and payment processors to play morality police is a perfect case study in the utility of cryptocurrencies. They ain't perfect, but "inconvenient to turn this payment into dollars to pay bills" is a considerable improvement over "no payment at all", and the sibling comments poo-pooing over said inconvenience are missing the point and letting perfect be the enemy of good.

Bitcoin is probably a barrier to entry, meaning the "users" in this industry don't all know or understand how to use Bitcoin, and so this would mean losing a portion of their less tech savvy userbase. On the other hand, almost everyone (who is online and able to purchase things) knows how to use a credit card.

Losing a portion of the less tech savvy userbase is a strict improvement over losing the entirety of the userbase due to an inability to take payments at all.

Like I answered to a sibling comment, I mistook who his customers were: advertisers! If we are talking about advertisers, switching to crypto makes way more sense.

> If we are talking about advertisers, switching to crypto makes way more sense

I would have assumed the opposite. Ad buyers aren’t idealogues.

No, but they are pragmatic. I understand this is simply a way to sidestep payment problems related to anti-porn regulations, not an ideological "crypto freedom" thing.

The advertisers are aware of what business the website is in, they want to advertise there, but the owner's bank closed his account.

Indeed. My response was more in a general sense, i.e. no matter who your customers are.

It would be a different story if there were a simple and straightforward method to convert a crypto into cash directly with the handler, but until a major credit card company is willing to tackle that burden crypto may not be the answer.

He said his customers are advertisers, not the people visiting his site

> We promoted affiliate programs and would get paid by our sponsors

Ah, missed that. It changes everything, I stand corrected.

I'd like to see the overlap of people that use bitcoin as a currency and pay for adult material on the internet.

His customers are the advertisers

> We promoted affiliate programs and would get paid by our sponsors

Are you under the impression that advertisers get paid in bitcoin? There is no need for crypto if you just want to pay exchange fees.

yes, and with an e-cash layer: https://github.com/cashubtc/cashu

Reply on news.ycombinator.com