Crackdown on Bitcoin Betting in China

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What’s the common denominator between the 2018 FIFA World Cup, Bitcoin, and gambling? If China comes to mind, you have guessed quite correctly, so our admirations. However, the fact of the matter remains that China is clamping down heavily on cryptocurrencies and any associated activities. Gambling, as it happens, turns out to be one of them.

The Undoing of a Gambling Den

Local police officials in China have managed to seize over $1.5 million worth of cryptocurrencies in what turned out to be a 2018 FIFA World Cup gambling scheme. All apprehended culprits will be subject to the full force of the law as stringent penalties apply to individuals who try to run gambling or cryptocurrency businesses.

The Chinese mouthpiece, Xinhua, reported that on July 11, the Chinese authorities had previously spotted a burgeoning gambling platform, which claimed to accept wagers in multiple cryptocurrencies, including bitcoin. Whilst not immediately evident who the culprits were, the platform was taken down.

In its brief lifespan, the website had managed to secure payments through loopholes, which allowed the platform to effectively hide any proceedings it had earned through cryptocurrency.

The modus operandi of the platform was somewhere outside the country, allowing the responsible individuals to hide their identities and operate in relative secrecy and at no risk to their own freedom, at least so it seemed at first.

According to the released information, around 330,000 users had used the website, generating up to $1.5 billion in cryptocurrency net worth.

Whilst finding the culprits was a challenging task, the police forces have managed to apprehend the six organizers and will now proceed to legal recourse. According to other sources, the number of arrestees was 540, addingthe facilitators of the gambling scheme and not necessarily the organizers alone to the original number.

As per the official statement of the local authorities, China will continue to maintain its strong focus on all gambling activities that transpire on its territory. An additional incentive will be added especially when operators of such places are trying to hide their true purpose by using cryptocurrencies to mask their illegal dealings.

The Scope

The operation has been quite ambitious, involving some 21 public security authorities in Guangdong. The arrests were quite swift, demonstrating the readiness of the Chinese government to leave no stone unturned when it boils down to forcing citizens to comply with the regulations.

The model that the gambling platform utilized used agents and shaped up everything as a pyramid, enticing customers to bring in more gamblers for extra freebies and goodies. This largely saved them the trouble of advertising in a manner that would have alerted the authorities. Despite their intentions, however, the Guangdong local watchdogs have quickly caught up with the activity which has led to the arrest of all the suspected individuals.

The Chinese authorities have proven quite apt at cracking on both gambling and bitcoin activities separately, but this has been one of the first activities when there has been an overlap between the two illicit segments.

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