PayPal Shuts Down Payments to UnoTelly Proxy Service

by Tracy Knauer •

PayPal has blocked payments for a VPN provider, UnoTelly, in a move that could set a problematic precedent for other VPN and proxy services.

UnoTelly reported on Feb. 4 that PayPal had begun blocking payments to the company. As a result, it said, customers can no longer use PayPal to purchase VPN access or other services from UnoTelly.

UnoTelly, which is based in Canada, provides a VPN service, as well as smartDNS. Both services allow people to access websites and apps that would otherwise be blocked in their locations due to factors like government censorship or the decision by a company to make online content available only in certain countries.

According to online reports, PayPal said it suspended payments to the UnoTelly because “PayPal may not be used to send or receive payments for items that infringe or violate any copyright, trademark, right of publicity or privacy, or any other proprietary right under the laws of any jurisdiction.” The message was that UnoTelly was facilitating copyright infringement and had been blocked for that reason.

Allowing people to access copyrighted content that would otherwise not be available to them because of their location is one of UnoTelly’s main selling points. But so is that of pretty much any VPN or other type of proxy service. It’s unclear why PayPal targeted UnoTelly specifically.

Practically speaking, the blockage probably won’t have a great impact. UnoTelly supports other payments methods, and customers can switch to alternatives easily enough.

Still, the move by PayPal sets a dangerous precedent. Any VPN or smartDNS provider can be used to access material that is restricted by copyrights in a particular location. Yet that’s certainly not the only thing you can do with a VPN or smartDNS. Those services can be used for plenty of other purposes that do not involve copyright infringement.

This type of rationale therefore makes it possible to hinder access to any proxy service for any reason, whether or not people are using it to access copyrighted material.

That’s why it’s a good thing there’s Bitcoin, a payment method that no single authority can block.

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