PayPal Bans Account of Hacker News and Freezes Funds, Bitcoin Could Be the Answer


The Hacker News, a widely-read cybersecurity-focused publication, has had its payment account banned by PayPal, raising concerns regarding political or subject-related bias and the potential use case of uncensorable currencies like Bitcoin as an alternative payment method.

In a public statement, the team behind The Hacker News wrote:

That’s so much frustrating. PayPal has permanently banned all of our accounts without mentioning any reason and hold wallet funds wrongly for 180 days. Upon asking, PayPal also refused to share any details.

Impractical Policy of PayPal and Bias of Payment Processors

In 2002, around the period during which e-commerce giant eBay acquired PayPal, the company realigned its vision from processing payments for individual users to catering its services for online merchants.

The shift in focus of PayPal and eBay’s acquisition of the firm naturally led the company to aggressively implement protection policies for buyers.

At the time, strict buyer protection policies were necessary because of eBay and its business model. Unlike Amazon, Alibaba, Flipkart, and more dominant e-commerce platforms that rely on algorithms and manual verification to filter out poor products and services, eBay as essentially an online auction platform created many issues for buyers.

In many cases, buyers did not receive products in the quality promised by the merchants and due to the consumer-to-consumer model of eBay, the distribution of fraudulent or fake products was difficult to prevent.

PayPal, as the native payment processor of eBay, integrated buyer protection policies for its former parent company, making the platform more safe for buyers at the cost of creating a significantly inefficient ecosystem for merchants.

The Hacker News, for instance, said that its accounts were banned by PayPal and its funds have been frozen for 180 days. Such an instance can occur when a group of buyers file complaints against PayPal and trigger their buyer protection policy.

To manually check the nature of the transaction, PayPal freezes the funds for 180 days. Its official policy on its website reads:

If your order doesn’t arrive or match the seller’s description, you have 180 days to raise your concerns with us, so we can help you. Here are some scenarios: You received a completely different item. You purchased two items, but received one. An item is defective but not immediately obvious. You bought the original, but received a counterfeit.

If a small group of buyers decide to ask for refunds or raise complaints, the account of a business can be frozen and payments sent after the incident can also be frozen as well, regardless of the status of the previous transactions.

However, in regard to PayPal’s shut down of the account of The Hacker News, the public has started to raise concerns of a potential political or a subject-based bias by payment processors.

In a statement, The Hacker News said that it inquired PayPal about the reason behind the shutdown of its accounts. The payment processor refused to provide any specific answer, declining a justifiable question submitted by the publication.

“Instead of giving a valid reason, company says ‘specific reasons for such a decision is proprietary and it is not released since that could impair PayPal’s ability to do business in a safe and secure manner’ Seriously PayPal? You have to mention at least one valid reason,” the publication said.

Merit of Bitcoin

Earlier this month, several high profile political commentators and content creators including Dr. Jordan Peterson, a best-selling author and a prominent Canadian clinical psychologist, were eliminated by Patreon from its platform without any basis.

A previous statement released by Patreon explicitly stated that the closure of accounts of “controversial” public figures on the platform was initiated and requested by Mastercard, a credit card payment processor.

The exercise of authority over independent platforms based on their subjective viewpoint of a certain subject or a political stance could set a dangerous precedent for the global society.

Unfortunately, as long as centralized entities remain in control of financial networks, the practice of such censorship is challenging to stop.

Dr. Jordan Peterson has started to accept Bitcoin as a response to the controversial decisions of payment processors and continuous censorship by centralized entities could push more content creators and businesses to cryptocurrencies like Bitcoin in the long run.

Featured Photo by Ilyass SEDDOUG on Unsplash


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Joseph Y

Joseph Yung is a financial analyst and investor who has worked in the cryptocurrency and technology sector since 2013. He's worked with leading publications within the cryptocurrency space, providing unique insights, interviews, market analysis, and technology coverage. You can contact Joseph at j@cryptomenow.com

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