I read from a fairly reputable source that money laundering is a huge problem in online sex industry.

Which makes sense - you have buyers and sellers who insist on anonymity, services that leave no trace once rendered, buyers and sellers lying to family and friends about what they're doing, etc.

There's often no "normal" amount of consumption, for example, some sellers receive million dollar tips.

Money laundering is a massive problem, and it enables some really terrible things.

I suspect the fact that American banks are so anti-porn comes from the fact that the American financial sector has such strong anti-money laundering regs (as opposed to, say, the American real estate sector, or the UK financial sector).

One of the reasons OF is doing well is because they insist on following know your customer laws. Not many porn platforms could function that way.

If it was about potential for money laundering, they'd have gone after the Steam item marketplace way before random adult games. Valve has had to take action against it in the past: https://www.rockpapershotgun.com/valve-block-counter-strike-... , but AFAIK it's hard to actually solve.

I've worked specifically on payment connected to porn. Money laundering is a fact, but this being the motivation for banks to pull away is not.

There have been several scandals related to payment processing and money laundering, and some of them connected to companies that do a lot of business with porn. Usually, you will see banks breaking away when those scandals break to the public.

However, banks do not break away just because they don't like the transactions they're seeing. What they actually do is to enforce stricter rules by financially penalizing those who make them lose money. Your transactions are getting canceled a lot (by having to be flagged/undone/paid back etc.)? You'll have to pay higher fees, and if it keeps happening, you will lose your license.

You know when they do often break immediately, however? When there are campaigns by special interests groups, usually connected to conservative groups, to paint companies as having illegal content, even when they don't have this problem any more than any social media platform. In those cases, they don't wait for any tribunal.

Don't kid yourself. Has nothing to do with laundering. Payment processors want more transaction volume. The only time they start doing this is if they get legal pressure.

The initial regulation also didn't suppress content, it just made you have to go through age verification, which everyone knows doesn't work.

That doesn't explain why Visa/Mastercard have gone after written erotica (gumroad, patreon, etc), Japanese manga/doujinshi distributors (DLsite), and video games.

It's not that any more. Or at least not just that :

Visa Japan’s CEO says disabling card payment for legal adult content is “necessary to protect the brand” :

https://automaton-media.com/en/news/visa-japans-ceo-says-dis...

(And from what I have understood, there's very little or perhaps even no shame in Japan about these things, so that applies even less there.)

>One of the reasons OF is doing well is because they insist on following know your customer laws

You’d think so, but nope. Using a throwaway account for obvious reasons.

I ended up subscribing to someone who’s catfishing. All their pics on OnlyFans and other socials were just stolen from random Instagram models. I reported it to OF, but got no response.

Whatever verification system OF has, it’s bypassable. It doesn’t matter much when it’s just regular subscribers - nobody really cares about consumer rights in the adult content space. That’s why so many creators can get away with pretending they’re the ones replying to messages. But I’m betting there’s going to be a CSEM scandal linked to this in the next few years.