Yet another enormous Chinese crypto scandal has been exposed as authorities have shut down an illegal online gambling site in a major arrest.
Chinese police in the south-eastern Guangdong province have according to local reports arrested hundreds for involvement in an online gambling platform that has allegedly processed over $1.5 billion (10 Million RMB) in cryptocurrency bets.
Allowing for bets in Bitcoin (BTC), Ether (ETH) and Litecoin (LTC), the platform has capitalised on the ongoing World Cup and has, since its launch eight months ago, attracted over 330,000 members.
Not only is gambling is illegal in China - and facilitating gambling can carry significant criminal penalties - but authorities have also accused the platform of being in effect a Ponzi scheme.
According to police, members of the platform - referred to as “agents” - were encouraged to bring on more members in exchange for increasing commissions, and even more worryingly the unnamed platform itself was allegedly manipulating odds for its own benefit.
With police shutting down over 250 chat groups linked to the site as well as seventy mobile apps and seizing smart phones, computers and hardware, a Guangdong Provincial Public Security Department official commented that:
the public security organisations will continue to maintain a high pressure on online gambling
Adding that the case:
is the most representative [example] of a new form of online football gambling
The world cup has seen the rapid rise of cryptocurrency sports betting – albeit without the criminal element.
With companies such as sportsbet.io, and wagerr.com among others offering dedicated sports betting in crypto – this week also saw the much-anticipated launch of decentralised prediction market platform - Augur- and its REP token.
Allowing for bets on any event – the platform was quickly put to use to bet on the fate of the World Cup semi-finals, with this bet made yesterday unfortunately not 'coming home':