What next, as crypto-currencies enter Cambodian casinos
The warning that unlicensed crypto-currencies are illegal in Cambodia brings no surprises, but will the country cope if gaming and crypto merge?
The declaration this week, that the unlicensed use or promotion of crypto-currencies in Cambodia is illegal, should really come as no surprise.
Cambodia, like its neighbor Vietnam, has seen a host of murky crypto-related launches and this announcement, signed by the National Bank of Cambodia, the Securities and Exchange Commission of Cambodia and the General Commissariat of National Police, warned the public to “be aware” and told offenders they will be “penalized in accordance with applicable laws.”
Crypto-currencies, said the announcement, might not have any actual collateral backing or offer any customer protection, are volatile and susceptible to fraud. The announcement identified four entities that were active in Cambodia, which included OneCoin, the global “multi level marketing” scheme that has been investigated by multiple law enforcement agencies and stands accused of being a multi-100 million dollar Ponzi scam.
There is, however, a lot more to the foggier side of Cambodian crypto than the four company names on that list.
In April, media across the globe reported that Cambodia was about to launch its own national crypto-currency. That was a big deal. Many might have talked about doing it, but to date only Venezuela has actually launched one. In Cambodia, a Chinese-linked business calling itself Entapay was reported to be behind the currency, and it was supposedly going to be rolled out at an “Asean Blockchain Summit” held in Phnom Penh.
Deputy Prime Minister Men Sam An and Hing Bun Heang, the unit commander of Prime Minister Hun Sen’s bodyguard, were partners, said Entapay, which also claimed support from the Royal Cambodian Armed Forces. But it was, it seems, all utter baloney and a quick cross reference on Google, on the individuals and entities supposed to be running the launch, revealed their listed professional bios to be either full of an incredible amount of typos – a laughably long catalogue of misspellings in regard to previous employers, projects and universities – or to be fictional. Entapay, as reported by local media, is no longer in Cambodia.
Someone who seems to be now very much in Cambodia, however, is Wan Kuok-koi. Released from a Macau jail in 2012 after serving 14 years for a series of casino-linked gangland crimes, Wan – or “Broken Tooth” as he is better known in the former Portuguese enclave – has just announced plans to build a “Chinese cultural town” in Cambodia. The town will be built, according to Wan, by apparently leveraging “blockchain technology.”
Wan is doing this in his capacity as chairman of the “World Hongmen History and Culture Association,” a fraternal Chinese cultural group that claims to have tens of thousands of members globally. In February, Wan was in the news again, when he announced his plans to launch a “security” branch of the Hongmen association to help “assist” businesses working along China’s “Belt and Road.”
“Thank the heavens for giving a once-in-a-century opportunity to give something in return to the country and nation,” Wan was filmed saying at the time.
Wan became notorious in the 1990s as much for his love of publicity as for his ruthless mob-rule antics – just before his incarceration he had a movie made about his life, called Casino, with Hong Kong A-list heartthrob Simon Yam playing the lead – but after his release from prison he has remained largely low profile.
That was, however, until last year, when he was linked to the launch of a Macau casino-focused crypto-currency called Dragon Coin, that in turn, somewhat bizarrely, was also linked to the discredited big data consultancy, Cambridge Analytica.
Dragon Coin offered a unique opportunity, said it business owners, to allow anyone to become ‘a shareholder in a junket.’ These VIP “junkets” – that control high-roller rooms in Asian casinos, especially across Macau’s $30 billion gaming industry – have never really managed to shake off their organized crime triad-gang roots. It was ultimately the bloody and often deadly battle to control these high-value rooms that put Wan in jail in 1998. That and the fact he also attempted to murder Macau’s chief of police with a car bomb.
At last year’s glitzy launch of Dragon Coin – that has since raised more than a not inconsiderable $300 million via an initial coin offering – Wan was spotted among the dignitaries on the stage. While the Dragon Coin management has been at pains ever since the event to say there is no formal link between the business and the former jailbird, there is no doubt that Wan is keen to get back into casinos. And indeed cryptos.
Wan’s Hongmen Association plans in Cambodia are not confined to the Chinese cultural centre project. Hongmen is also opening hotels and casinos and yes, there are plans to launch a crypto-currency.
Cambodia already has at least one crypto-currency based casino business. Asia Live Tech, that claims it is “the first Bitcoin gaming software provider in Asia” offers “cost-effective … casino solutions” for “Bitcoin and other crypto-currencies.” It says it has a gaming license issued by the Cambodian government, via its Lucky Ruby casino resort on the country’s southern border with Vietnam.
In May, 2017, Vietnamese authorities raided offices in Ho Chi Minh City linked to Asia Live Tech as part of an investigation into illegal online gambling sites that reportedly “handled wagers worth hundreds of millions of dollars.”
It was just one of many such operations, by Vietnamese and Thai authorities to try to control a ever spawning online gambling industry that has Chinese roots but Cambodian-based operations.
How the introduction of crypto-currencies, Broken Tooth or indeed the Cambodian authorities, will change any of this remains to be seen.
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