Macau casino scene threatened by digital currency
Casino haven Macau has been inching closer and closer to the launch date of its digital currency. This currency will be backed by the state and is targeted towards stopping fraudsters and money laundering activity from casinos and gambling venues.
The Chinese autonomous region is known has being the Vegas of Asia, as it sees billions passing through its casinos. These high-profile venues are also well-known for activities such as tax evasion and money laundering, and have even allegedly taken part in terrorism financing. The government created a digital currency to fight against these illegal activities.
Ho Iat Seng, chief executive of Macau, said:
“The government will work with China’s central bank to study the feasibility of issuing a digital currency.”
The executive further mentioned that the government was looking to modify laws for the regulation of the digital currency issuance process, however there have been no concrete plans yet concerning the release of this currency.
Many casino operators in the region were apparently approached back in December of last year by regulators in order to go over the practicality of the digital currency instead of fiat currencies. What this would do is make every single transaction visible to the local regulators, as well as to banks, meaning that it would sharply decrease the occurrence of money laundering or similar illegal activities.
Many industry experts have stated that they will require additional information so as to assess the effect of this digital currency in the region’s multi-billion dollar casino scene.
Analysts at Sanford C. Bernstein have already stated that utilizing these digital currencies can possibly completely omit the junket system and even bring about irreparable damage and money loss for the casino scene. Despite that, they also said that this could be a positive in the long-term, since the currency will be more easily accessible.
Up until now, it has not yet been revealed whether the region’s currency will be based on a blockchain or not, or if it will be different from Mainland China’s digital yuan currency, since Macau uses the pataca, which is different than the Chinese yuan.