Former Macau Triad Gangster, Wan Kuok-koi, is reported to have raised $750 million in less than five minutes from an ICO for his new HB cryptocurrency. According to the South China Morning Post, Wan, also known as “Broken Tooth”, has partnered with a mysterious Beijing firm called Zhonggongxin Cosmos Internet Technology Limited to create a cryptocurrency designed to back chess and poker tournaments throughout China.
Wan’s company, World Hung Investment, is said to have already sold 450 million if its 1 billion HB tokens following fundraising events taking place in Cambodia, Thailand, and the Philippines. The final fundraising event is set to take place this month in Malaysia.
According to reports looking into the Zhonggongxin Cosmos website, the new company is planning on hosting chess and poker tournaments online as well as live tournaments primarily based out of Hainan, China. The company is said to have received exclusive government authorization for the project. Wan has a handful of physical gaming halls already established and hopes to create thousands more within the next 3 to 5 years. Tournaments are said to begin in October and may run for the whole year.
“We may pay the prize in half cash, half HB,” says Zhonggongxin Cosmos staff member, Guo Jia. He states that “the big bosses from both sides” will be releasing further details later.
China has become a hotbed for controversy surrounding online gambling. The country has strict gambling laws in place, and government authorities are regularly attempting to crackdown on illegal gambling rings, most recently arresting 500 Chinese gang members involved in a $1.5 billion dollar illegal sports betting operation on July 12th.
Broken Tooth’s online poker tournament circuit has already begun to receive massive amounts of criticism from regulated gambling firms within China who claim that the new company is using cryptocurrency to take advantage of an unregulated grey area within Chinese law.
“When chess and poker games are paid with tokens such as cryptocurrencies that can be converted to fiat currencies, it becomes a disguised form of gambling in China,” says founder of the China Lottery Industry Salon, Su Guojing. “There’s a legal loophole on this issue.”
The founder of a cryptocurrency social network and information portal called Shubei, named Li Yongfeng, also expressed concerns that HB has been suspiciously vague in describing the technology underlying its platform. He says the company’s source code makes it impossible for people to track and verify where money is moving.
“People would not be able to know how many tokens are issued without details of its technology, ” said Li.
China has a massive gambling market, with the country’s gaming capital, Macau, regularly generating over $3 billion in monthly revenue. However, it is suspected that a vast majority of the market remains unaccounted for, operating through underground games both live and online.