Guangdong district of Southern China witnessed a crackdown that revolved around FIFA gambling racket on July 12, 2018. The racket involved a large portion of cryptocurrencies. The racket was busted by local police in China who claimed to have seized $1.5 million worth cryptocurrencies.
The gambling platform had been under close surveillance since May 2018 as it was claiming to be a gambling platform that would accept the cryptocurrencies too. The platform accepted bitcoin, Ethereum, and Litecoin. South China Morning Post reported that the network busted was operating on the dark web and 540 arrests have been made till now. The probe is still going on the Local Police and $1.5 million worth cryptocurrency and $700,00 have been frozen in the illegal bank accounts.
Gambling is considered an illegal activity as per the Chinese legislation passed in 1949. Only the state-run welfare games and lotteries are deemed legal. The FIFA gambling racket involves around 20 independent gangs and has incorporated 330,000 members. These members were made to join the racket using online chat groups that went to the count of 250 and the racket had launched 70 mobile applications. It took the racket around eight months to create a base of 330,000 members. Around 8,000 agents with gambling experience received heavy commissions from the racket to recruit new members that led to the Ponzi scheme in cryptocurrency.
The special investigation team identified some regulatory loopholes that let the racket hide around $1.5 million worth cryptocurrency.
Guangdong police claimed that a heavy activity was in process under their “Online Clean and Secure” and that is what led them to the $1.5 million FIFA gambling racket busting. The operation was built particularly to identify the illegal web-based gambling that was becoming more and more prevalent during the events like World Cup.
After the blanket ban of September 2017 on cryptocurrencies, Chinese authority has been trying to regulate the anonymous trade of cryptocurrencies. Cryptocurrency received a lot of negative attention for being a currency of trade hiding the terrorist funding, gambling and other darknet financings.
China remained on the front foot to propagate the advantages that blockchain technology brings and its ICO launches have been really innovative. Chinese officials believe blockchain to be highly disruptive technology and have been empowering the Blockchain technology enthusiasts by offering an incubator as per the 13th five-year plan. It will be a billion dollar project that has been proposed by Chinese officials who understand the power of blockchain.
