- Legal States
Deyan Dimitrov December 1, 2022 3 min read
1xBet’s Bankruptcy in Curaçao Appears Inevitable
1xBet, one of the world’s largest online sports betting companies, continues to make headlines in the worst possible ways. The company is now facing an imminent threat of bankruptcy in Curaçao, after a prolonged legal battle with the Foundation for the Representation of Victims of Online Gaming (SBGOK).
1xCorp N.V., originally from Russia, operates 1xBet and numerous other online sports betting and iGaming platforms. The company has attracted its fair share of controversies over the years, but 2022 may be its worst year yet. Many have deemed the online sportsbook giant too large to fail, but 1xCorp’s empire is starting to show significant cracks.
The Operator Stalled the Court as Long as Possible
Trouble has been brewing in Curaçao since November 2021 when 1XCorp was declared bankrupt by a local court. Player advocacy group SBGOK filed a lawsuit on behalf of several players whose winnings 1xBet allegedly failed to pay out. According to Curaçao’s Attorney General, failure to honor even a single due claim was a sufficient cause to declare a company bankrupt.
Further investigation revealed that 1xCorp owed millions of dollars in unpaid taxes and winnings, but was managing to juggle its debts in order to stay afloat. The court eventually ruled in favor of SBGOK and declared the operator bankrupt. However, some skillful legal maneuvering allowed 1xCorp to overturn the initial court decision by disputing SBGOK’s rights to represent players. What followed was a prolonged legal tug-of-war. As of the writing of this article, 1xCorp is in the process of appealing the court’s latest verdict, but it appears the company is just stalling the inevitable.
A Final Ruling Seems Imminent
R.J. Boswijk, Curaçao’s Attorney General, recommended that the Supreme Court should officially declare 1xBet’s bankruptcy. Although such advice officially holds no legal weight, historic precedent shows that the court usually complies in such cases. Such a ruling would end the operator’s stalling attempts.
According to Arend de Winter, the lawyer in charge of the bankruptcy proceedings, 1xBet were extremely uncooperative, even refusing to attend the initial case against them. He also drew attention to the fact that the 1XBet sites changed ownership several times during the bankruptcy proceedings, even though 1XCorp was still reported as an operator.
Questions are evaded and promises are not kept. The trustee cannot avoid the impression that there is willful opposition.Arend de Winter
SBGOK originally claimed that the 17 players it represented were due 1.6 million Netherlands Antillean guilders (approximately €830,000) in a mixture of fiat and cryptocurrency. Three more individuals have since levied individual claims, and the Curaçao government joined in by demanding €1.3 million in unpaid taxes.
Bankruptcy Would Barely Inconvenience 1xBet
An important caveat regarding the whole case is that even if 1xBet is declared bankrupt in Curaçao, it will probably have no immediate influence on the operation of the website. Since the operator is primarily based abroad it doesn’t even hold a bank account in the Dutch overseas territory, making any meaningful legal action extremely difficult. Attempting to seize the company’s foreign capital would undoubtedly spark yet another prolonged legal battle.
The only real measure the Curaçao government can undertake is to revoke 1XCorp’s license. However, the operator is likely already prepared for that eventuality and, as evidenced in Russia, it is more than willing to skirt the law in order to make a profit. Even so, a successful lawsuit would prove that the giant is not invulnerable and may cause more jurisdictions to look into the company’s unsavory practices.