China: Authorities bust illicit cryptocurrency betting platform

As the World Cup comes to a close, many people have been placing bets with cryptocurrencies and blockchain. But while some international stars are launching their own virtual currencies, other people are using them for more nefarious purposes, Bitconist reports.

Betting often goes hand-in-hand with sporting events, and this World Cup has been no exception. Early projections say bookmakers are on track to profit $36.4 billion dollars from the summer competition. Profits in the UK alone are estimated to at least double from the 2014 World Cup.

Many gambling hubs have made a lot of money off of this year’s World Cup, and police have started to crack down on some of them.

The announcement by the Guangdong Provincial Public Security Department said the illegal platform only accepted bets in Bitcoin, Ether, and Litecoin. Operators decided to create a multi-tier system where participants could be rewarded for bringing in members and focused on acquiring more digital currency to hedge against losses, i.e. a pyramid scheme.

Authorities said the gambling operation had at least 330,000 members and 611 cryptocurrency wallets. The scheme was able to operate worldwide and gave Chinese participants the option to cash-out their winnings.

According to police, the bust was part of a provincial-wide endeavor to shut down World Cup-related online gambling. Other gambling gangs have been shut down in areas like Fuzhou, Shenzhen, and Zhejiang.

Police across China have issued warnings to citizens about engaging in online betting. Social media posts from police in Beijing assert that 95% of overseas gambling websites are actually just phishing sites. Media in China has reported on how foreign gambling sites have a reputation for targeting Chinese fans.

However, cryptocurrency and blockchain technology has started to attract attention from some football players and clubs.

Many people have heralded the entrance of blockchain technology into the sports world, especially when it comes to betting.

A couple of clubs, like RCD Espanyol in Spain and Arsenal in the United Kingdom, have agreed to sponsorship deals with decentralized platforms. An amateur club in Turkey even completed a transfer using Bitcoin at the beginning of the year. Cryptocurrency exchange CoinDeal agreed to sponsor the Wolverhampton Wanderers in early July.

Some football players have also dipped their toes into virtual currency and blockchain. International superstar and five-time Ballon d’Or winner Lionel Messi has reportedly been “digging deeper into blockchain and decentralized systems.”

Former Brazilian footballer Ronaldinho has also expressed heavy interest in cryptocurrency, having announced his new Ronaldinho Soccer Coin (RSC) in February.