Welcome to part 2 of the comprehensive guide to using cryptocurrency as a sex worker. If you missed part 1, go back to catch up on how cryptocurrency works, the costs and benefits for sex workers, and navigating the world of alternative cryptocurrencies.
Now it’s time to discuss the practicalities of using cryptocurrency and essential safety and privacy precautions to keep your money and personal information secure.
This guide was put together by Cara Lorelei, a sex worker based in Germany with prior experience in the cryptocurrency industry, with help and oversight from dxo, a cryptocurrency security specialist passionate about making this technology more accessible.
We understand there is tremendous variation within sex work. It’s impossible to address every possible use case for every possible type of sex worker. Our focus is on the essentials you’ll need to start receiving and sending payments independent of mainstream payment processors. As our focus is on payments, you won’t find any advice relating to investing and speculation.
Please bear in mind the cryptocurrency landscape is ever-changing. While we’ve tried to focus on fundamentals, the information in this guide could become outdated. Any products or services mentioned are not outright endorsements, but rather suggestions. Cryptocurrency is not for the faint-hearted. But if anyone’s equipped with the smarts and instinct to leverage it, it’s sex workers.
Choosing the Right Wallet For You
You store cryptocurrency in a ‘wallet’ from which you can send and receive payments.
Wallets store your ‘private’ key, from which your ‘public key’ is derived. Your public key is your wallet’s address, used to send cryptocurrency to you. As the name suggests, a public key is visible to anyone. Each wallet also has a private key (often referred to as a ‘seed phrase’) allowing access to the associated funds. Think of your seed phrase as a password that should only be known to the wallet owner. You should never, ever share it with anyone.
Using the seed phrase, a wallet can generate unlimited addresses (roughly equivalent to “public keys”). You can think of an address as a username or IBAN: a unique identifier that you can share with someone who wants to send you money. In this way, a wallet can open an unlimited number of independent bank accounts, without having to verify the user’s identity.
Understanding which type of wallet is best for you and how to use it is the first step in adopting cryptocurrency. Here, we detail the two main types of wallets you’ll need to know about and their pros and cons.
- Software wallets. A digital application or program where you can store, send, and receive cryptocurrencies. This is the most common and most accessible option. We’ll assume that’s what you’re using throughout the rest of this guide.
You can install a software wallet on your device for convenient access. Depending on the platform, you can manage multiple cryptocurrencies in a single wallet. Software wallets tend to be easy to use for beginners. But they are suboptimal for long-term storage, especially for larger amounts. You shouldn’t need to verify your identity to use one. When signing up, go direct to the URL. Be cautious of clicking search engine adverts due to the risk of phishing scams.
Software wallets can be either custodial or non-custodial. When using a non-custodial wallet (such as Phoenix) you keep full control of your Bitcoin. When using a custodial wallet (via a centralized exchange such as Kraken), you transfer your money to the company’s wallet. You do not have to manage a seed phrase. Many people find this convenient, as it reduces the risk of losing your money due to forgetting it. Some custodial wallets even offer insurance against theft and are generally more regulated.
The downside of custodial wallets is the risk of the company taking your money if they decide to come after sex workers—or if they get hacked or misuse user funds. Due to their centralized nature, transactions tend to be slower and more expensive. The downside of non-custodial wallets is that managing your seed phrase can be challenging, especially for inexperienced users. There’s no option for account recovery if you lose it.
You should be clear on whether a wallet is custodial or non-custodial before signing up.
- Hardware wallets. A physical device that stores your private keys and therefore your cryptocurrency. These resemble a USB drive. Hardware wallets are more secure than pure software wallets. They keep the private keys in a segregated and tamper-resistant device, offering enhanced protection against many common attacks. They are somewhat less practical for making transactions compared to a software wallet.
If you’re holding more crypto than you can afford to lose, a hardware wallet is a good investment. Established options include Ledger, Trezor, and ColdCard.
Sending & Receiving Cryptocurrency Payments
Once you’ve set up a wallet, you’re ready to start making and receiving payments. Your wallet of choice should allow you to share your address with clients, either as a written address or a QR code.
We recommend using QR codes when possible to reduce the possibility of human error. Many wallets can generate a QR code with the amount attached, reducing the risk of client disputes. You can also share it publicly to receive tips without divulging personal information. Unfortunately, this increases the risk of deanonymisation, as we’ll discuss later.
When receiving payments, ensure your wallet is compatible with the sent cryptocurrency. For example, sending Bitcoin to an Ethereum address will permanently lose funds. Be sure to communicate this to clients less experienced in using cryptocurrency.
Bear in mind, that there may be an anxiety-inducing period when a sum of cryptocurrency has left the sender’s wallet but hasn’t arrived in the receiver’s. This also tends to occur when you’re depositing cryptocurrency into an exchange. Don’t panic! As long as the address is correct and you’re using a legitimate exchange, it will show up.
Once you receive a payment into your software wallet, it’s advisable to sell it right away via an exchange or move to a hardware wallet for long-term storage.
Sending cryptocurrency payments requires the recipient’s address or corresponding QR code. The same precautions apply in reverse. After confirming the transaction, you can monitor its status using your wallet’s transaction history or blockchain explorer tools. There will be a waiting period between submitting the transaction and it undergoing confirmation on the blockchain, which may take some time depending on network congestion and transaction fees.
Converting Cryptocurrency into Fiat
Once you’ve received a payment, unless you plan to hold it long-term, you’ll want to convert it to your country’s currency (known as fiat).
The simplest option is to use a centralized exchange. Ensure the exchange complies with relevant regulations and offers fiat currency withdrawal options. Registering an account usually involves verifying your identity. This can take a few days or longer if you have to resubmit documents. Once verified, you can deposit cryptocurrency, sell it, and deposit fiat into your bank account.
Despite their ease of use, centralized exchanges pose several issues for sex workers. As a centralized authority holding large amounts of cryptocurrency, they are a target for hackers. In a security breach, you could lose funds and have personal information compromised. You can reduce this risk by using an established exchange with a history of robust security. But it’s always a possibility. Exchanges—notably, FTX—have also stolen user funds.
Centralized exchanges are subject to government regulations. Laws can change with little warning resulting in account restrictions or even shutdowns. There have already been cases of centralized exchanges flagging and suspending sex worker accounts. We expect censorship to become more of an issue if cryptocurrency gains wider use in adult industries.
We recommend caution with centralized exchanges as they do not give you full control. It’s a good idea to deposit smaller amounts when using a new exchange for the first time. We do not recommend centralized exchanges for long-term storage.
Some centralized exchanges leverage loopholes in the financial industry to offer restricted features without identity verification. This does not eliminate the possibility of them targeting sex worker accounts. They can be a good option if you accept cryptocurrency payments infrequently. You can find a list here.
Another option to explore is a cryptocurrency debit card, which allows you to spend cryptocurrency anywhere that accepts Visa or Mastercard cards. You can also withdraw fiat from an ATM. When you make a payment, the corresponding amount is taken from your wallet. The key benefit is seamless payments without needing to deposit into an exchange first. Availability varies depending on your jurisdiction and may depend on a credit check and identity verification.
If a centralized exchange is not the right choice for you, consider a peer-to-peer (P2P) platform. These allow for direct trading between users rather than via an intermediary. So when you sell cryptocurrency, you do so directly to another user. Instead of transferring your funds to a company, you keep control. There’s less risk of losing funds if the exchange is hacked or having personal data compromised in a breach.
For cryptocurrencies other than Bitcoin, decentralized exchanges (e.g. Uniswap for Ethereum) are another option. Unfortunately, they only work for exchanging between different cryptocurrencies and not for fiat conversion.
Spending Cryptocurrency
While you can’t (yet) spend cryptocurrency as easily as fiat, there’s a growing list of ways to spend it without needing to convert. Directly spending cryptocurrency saves you the fees associated with exchanges and allows immediate use.
- Sex work advertising sites—A growing number of platforms for sex workers to advertise accept Bitcoin payments as a means of greater independence from payment processors which censor adult payments regardless of legality. Examples: Tryst, Massage Republic.
- Travel services—Several travel booking platforms now accept cryptocurrency payments for flights, accommodations, and travel packages. You can pay for a flight with Bitcoin regardless of whether the airline accepts it directly. Examples: Travala, Alternative Airlines, Bitpay.
- Giftcards—Various websites sell gift cards for popular retailers and services using Bitcoin. You can then use these gift cards to shop at stores such as Amazon that do not accept Bitcoin. Examples: Bitrefill, Coinsbee, Coingate.
- Charitable Donations: Many non-profit organizations and charitable foundations accept Bitcoin donations. Examples: Wikipedia, The Internet Archive, UNICEF, Greenpeace
- Gaming and Entertainment: Online gaming platforms, streaming services, and digital content providers often accept Bitcoin payments for subscriptions, in-game purchases, and content downloads. Examples: Bitrefill, Coinsbee, and Coingate—which allow you to purchase gift cards from sites such as Amazon, Etsy, Spotify, Airbnb, Google Play, and Zalando.
- Peer-to-Peer Transactions: You can use Bitcoin to pay friends, family, or acquaintances for goods or services. While this may be less practical than mainstream options such as Cashapp, it offers increased privacy and greater access. If you’re sending money internationally, cryptocurrency is often cheaper and faster than options such as Western Union.
- Subscription Services: Several subscription-based services, such as VPN providers, online storage platforms, and premium content websites, accept cryptocurrency payments. Examples: Microsoft, Twitch, Namecheap, Mullvad.
Security Essentials When Using Cryptocurrencies
When using cryptocurrency, it’s crucial to prioritize security to protect your assets. Here we detail a few essential precautions. These are much the same precautions you know to take in general online, but it’s always good to have a refresher.
Keep your seed phrase private
Never, ever share your seed phrase with anyone. If you share your seed phrase, your digital currency will be lost forever. Any website that asks you to enter this information is a scam. We cannot emphasize the importance of this point enough. This might be the most important thing you can learn from this guide.
Use strong passwords and a secure password manager
Create strong, unique passwords for all cryptocurrency-related accounts, wallets, and exchanges. Avoid guessable passwords. Use a password manager to generate and store complex passwords. Bitward and 1Password are good options.
Always enable Two-Factor-Authentication
Enable two-factor authentication (2FA) on all cryptocurrency accounts and platforms whenever possible. 2FA adds an extra layer of security by requiring a secondary verification method. For example, a one-time code sent to your mobile device or generated by an authenticator app. This decreases the risk of someone else getting control of your account. We do not recommend using any service which does not offer 2FA.
Update software regularly
Keep all software and applications related to cryptocurrency updated to the latest versions. This includes wallets, exchange platforms, operating systems, and security software. Regular updates ensure you’re up to speed with patches to protect against vulnerabilities. Don’t delay, click ‘update’ right away.
Ensure you choose a secure wallet
Be sure to choose a reputable provider when using a software wallet. Do your research to understand their security features and reputation in the community. Ensure you’re using a wallet that automatically changes your address every time. For longer-term storage, consider using a hardware wallet.
Be vigilant against phishing attacks
Avoid clicking links or providing personal information in emails, messages, or social media posts. When using a web-based service, always go to their URL rather than clicking links. Be cautious when clicking search engine adverts. Always double check you’re on the correct address before entering log-in credentials. We recommend bookmarking such pages to be safe. Treat any website asking you to enter your seed phrase with extreme skepticism, it is always a scam.
Back up your seed phrase
If you forget your seed phrase, your money will be lost. Therefore we recommend backing it up somewhere secure. Ideally, store it completely offline (e.g. written on paper). Never store it unencrypted on any device connected to the internet. This includes plain text files on your laptop or the notes app on your smartphone. If you’re sure you are storing smaller amounts only, it may be reasonable to keep a copy of your seed phrase in your password manager. Be aware that any hack of the password manager may result in the loss of all your funds.
Long-term self-custody of larger amounts of crypto is a rather complex topic. We have space here to provide only a brief overview. When backing up seed phrases for long-term storage, consider using multiple backups. Follow the 3-2-1 rule: 3 copies of your seed phrase, in 2 different mediums, with 1 copy off-site.
Good options for an off-site backup include safe deposit boxes (although nothing is perfect—dxo personally lost backups after a safety deposit box break-in), or hidden in the home of someone you trust. You may also wish to consider storing half of your seed phrase in one location, and half in another. This provides additional security if one of your backup locations is compromised since you must know the full seed phrase to be able to move any funds stored there.
Anonymity in Cryptocurrency Transactions
Understanding the level of anonymity provided by cryptocurrency is crucial for protecting your privacy and security. While Bitcoin and other cryptocurrencies are often perceived as anonymous, the reality is more nuanced. We still think cryptocurrency offers significant privacy benefits over alternative payment methods.
Focusing on Bitcoin, transactions are pseudonymous rather than anonymous. Transactions are not linked to real-world information such as name and address. There is no direct way for someone to find this information when you send or receive a Bitcoin payment. However, all transactions are recorded on the blockchain (which is a public ledger), with the associated wallet addresses as identifiers.
Good Bitcoin wallets will generate a new address each time you receive funds. This offers some degree of enhanced privacy. But tools like Chainalysis can link patterns of activity to an individual regardless. Deanonymization is a concern if you share your address publicly, e.g. to receive tips. Centralized exchanges also collect identifiable information in conjunction with your wallet address. There is the potential for them to share it with third parties such as law enforcement. When using a centralized exchange, be mindful of risks related to the legality of your work.
Bitcoin ATMs (depending on availability) and peer-to-peer exchanges reduce the risk of deanonymization for crypto-to-fiat conversions.
There are also services called ‘mixers’ which break the link between your wallet addresses. We recommend caution when using mixers. They are often custodial (meaning you hand over control of your money) and analysis services may mark wallets that have used them as suspicious. Some mixers may also be illegal depending on your jurisdiction.
Sophisticated blockchain analysis tools and techniques can trace and analyze cryptocurrency transactions. Law enforcement and other organizations use these tools to identify patterns, track funds, and de-anonymize users. While Bitcoin offers a degree of privacy, it is not anonymous. Transactions can be subject to scrutiny.
If a client has access to Chainalysis via their job, we consider it in theory a risk they could learn identifiable information from your wallet address. We do not know if this has ever occurred. Considering this tool is available to large organizations rather than individuals and costs tens of thousands of dollars, the risk of someone accessing it to stalk you seems low. Due to the limited public information about Chainalysis, it’s hard to be sure. Stalking risks may also be a concern if clients work for an exchange you use.
Cryptocurrencies known as privacy coins (e.g., Monero, ZCash), offer enhanced privacy features. Privacy coins obfuscate transaction details, including sender and recipient addresses, amounts, and transaction history. These privacy-focused cryptocurrencies aim to provide stronger anonymity compared to Bitcoin. If this is a serious concern, consider researching whether a privacy coin might be the right cryptocurrency for you. The downside is they are more niche than Bitcoin, making them more difficult to use and to onboard clients.
We do not recommend operating under the expectation of permanent anonymity even when using a reputable privacy coin. Transactions are still recorded on the blockchain permanently, so there is always the risk of new deanonymization techniques being developed in the future.
***
If you’ve made it this far then congratulations, you probably have a better understanding of cryptocurrency than 99.9% of people. We hope you now feel more confident using this technology as safely as possible.