Chinese Authorities Bust Illicit Cryptocurrency Betting Syndicate

Sunday, July 15, 2018 2:45 PM UTC

Sunday, Jul. 15, 2018 2:45 PM UTC

A far-reaching illegal gambling ring accepting only cryptocurrencies on the dark side of the web was busted this week, highlighting the importance of betting with reputable operators.

Chinese police raided an illicit gambling ring that had racked up $1.5 billion worth of World Cup bets using cryptocurrencies Ethereum, Bitcoin and Litecoin. The site could be accessed only by untraceable search engines on the dark web, but it attracted 300,000 customers in a matter of months. Officers in Guangdong Province collared six main suspects in the syndicate, froze the 5 million yuan in their bank accounts and seized more than 10 million yuan in cryptocurrencies they own.

Guangdong police said the syndicate heads recruited 8,000 agents who all earned commission for recruiting new customers from across the globe. It accepted only cryptocurrencies and it "used the loophole that virtual currency is not effectively regulated in our country" to make huge profits, said the police statement. More than $1.5 billion worth of bets were placed. It was a risky site for bettors to use, as the statement said: "The bookmaker analyzes the gambler betting, manipulates the odds according to the bet ratio, and allows a small number of people to win."

Betting using cryptocurrencies is highly appealing due to the speed, anonymity and lack of handling fees it carries. Yet it is something of a wild west, so you should use only reputable betting sites that have a long history of fairness and prompt payouts. Most of SBR’s top-rated sportsbooks have started accepting Bitcoin in recent years, so there is no need to put yourself at the mercy of untrustworthy sites that could get busted at any moment.

Chinese officials have been busy cracking gambling rings throughout the World Cup. Police in Beijing arrested more than 40 suspects linked to an online gambling scheme with bets worth 320 million yuan during the tournament, part of an ongoing clampdown. This latest gambling ring is thought to amount to one of the first cryptocurrency crimes involving a major sporting event to ever take place.

The major cryptocurrency, Bitcoin, has continued to tread water for the past week. It has not been prone to the wild fluctuations we have seen for the majority of the year, and that is a positive for bettors that like to wager in Bitcoin, as it eliminates the possibility of your margins being eroded before the bet is settled. For all the positivity surrounding cryptocurrencies, it is counterbalanced by stories like the Guangdong bust. Bitcoin and its competitors are global currencies, so they are at the whim of all markets around the world, from the U.S. to China.

Coinbase Custody Launches

One positive story from the past week was the launch of Coinbase Custody, which brings more legitimacy to the market as institutional capital will now have an easier route to enter the market and increased demand should boost price. Coinbase has pioneered leading crypto storage techniques and is currently responsible for the custody of more than $20 billion in crypto assets.

“Coinbase Custody builds on this expertise to offer a brand new, independent solution for our institutional customers,” said the firm. “Coinbase Custody’s mission is to make digital currency investment accessible to every eligible financial institution and hedge fund in the world. We’ll achieve this by striving to become the most trusted and easiest-to-use crypto custody service available.”

Blockchain technology continues to improve and develop useful applications in everyday life, and Coinbase Custody could help give the market a further boost. It might take a little while to see the effects, but experts believe the market for crypto will grow more bullish by mid-August and the prices of Bitcoin and Ethereum will start to climb. Bitcoin skyrocketed in the second half of 2017, and investors hope we will see similar gains this time around. “By the end of the year, it’s going to be $9,000,” investor Tom Lee said.

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