Chinese police break up $1.5 billion cryptocurrency World Cup gambling ring

14-Jul-2018 Intellasia | South China Morning Post | 6:02 AM Print This Post

Chinese police have broken up an illegal World Cup gambling ring hosting more than 10 billion yuan (US$1.5 billion) worth of cryptocurrency bets, in the first major sports betting crime involving digital money in the country.

Police in southern Guangdong province said in an online statement on Thursday that they had apprehended six major suspects of the syndicate, frozen about five million yuan in their bank accounts, and seized over 10 million yuan worth of cryptocurrencies they own.

The gambling platform ran on the so-called dark web, which isn’t indexed by traditional search engines, and only accepted cryptocurrencies such as bitcoin, ethereum, and litecoin, according to Guangdong police. During the eight months of gambling platform’s operation, the site attracted 330,000 registered users from numerous countries, and built an army of over 8,000 agents who earned commissions for recruiting new members through a pyramid scheme, the police said.

The gambling syndicate “used the loophole that virtual currency is not effectively regulated in our country” to make huge profits, said the police statement.

Last September, the Chinese government shut down all local crypto exchanges and banned initial coining offerings, a form of crowdsourced fundraising involving cryptos, amid fears they could create financial instability. The Chinese central bank announced this week that the yuan-bitcoin trading pair has dropped to less than one per cent of the world’s total bitcoin trading, state news agency Xinhua reported.

Chinese authorities have foiled a string of gambling syndicates since the start of the World Cup. Last week police in Beijing arrested over 40 suspects linked to an online gambling scheme with bets worth 320 million yuan.

In a separate statement on Thursday, Guangdong police said they had arrested a total of 540 suspects from over 20 gambling rings, and frozen 260 million yuan related to the criminal activities, in a special campaign to crack down on World Cup gambling. But the crypto case “is the most representative of the new-type of online football gambling so far,” the statement read.

https://sg.news.yahoo.com/chinese-police-break-us-1-053642649.html

 


Category: China

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