https://mirandayardley.com/en/the-cotton-ceiling/

“The term “Cotton Ceiling” was originally coined by the intensely awesome Canadian trans-activist and porn star Drew DeVeaux, in which she referred (quite specifically) to the tendency within feminist and queer women’s spaces for trans women to be, while nominally accepted as women and supported in their pursuit for rights and equality, regarded and treated as essentially de-sexed, unfuckable, and sometimes a bit repulsive, with this becoming highly politicized in regards to its implications for things like what a lesbian sexuality really means, how much of sexuality is “orientation” and something we can’t be held accountable for and how much is mediated by our perceptions, how sexuality can reveal that biases and lack of respecting gender identity continue to exist on visceral levels despite being intellectually (or superficially) rejected, etc.

The “cotton” refers to underwear. The idea being here that no matter how much basic, nominal acceptance a trans woman can receive in feminist or queer or women’s spaces, we’re still always ultimately rejected when it comes to breaking the sexual barrier, and being accepted as women to such a full extent that we are accepted sexually as women.”