Beijing to test digital yuan in Macau casinos
China authorities want to use Macau casinos to test the Chinese crypto-currency. Regulators will take the opportunity of the new concessions tender to force operators in the offshore gaming hub to become testing sites for the digital yuan, Reuters reported yesterday.
The agency cited the recent public consultation paper on the rebidding process which pitched ideas like appointing government agents to supervise daily operations.
The average high roller lost over 27,000 on each visit to the tables in Macau, Bernstein analysts estimate.
The city’s casinos have also been a haunt for corrupt officials and businessmen. In December, junket operator Suncity’s boss Alvin Chan was implicated in an investigation into illegal cross-border gambling activities and money laundering.
Suncity facilitated bets for wealthy VIPs, a market segment worth around 8 billion in gaming revenue in 2019.
The central bank’s governor Yi Gang suggested China’s newly developed crypto-currency could be useful for fighting crime and resolving complex cross-border payments problems, including money-laundering. Macau might have been on his mind, Reuters wrote.
Migrating the gaming hub to digital payments would complement Beijing’s desire for greater oversight of cash flows and customers. Situated outside Chinese capital controls, Macau is also an ideal place to test the technology before rolling it out more widely on the Mainland. Others are already considering the concept of cashless casinos using traceable funds. Australia’s Star Entertainment, for example, says it is exploring digital payments to assuage its watchdogs.
VIP favorites like Galaxy Entertainment and Wynn Macau might once have worried that big spenders would shy away from such scrutiny. However, high rollers no longer rule income statements. The mass market now accounts for two-thirds of gaming revenue and almost 90% of earnings according to official data and estimates.
According to Reuters, testing is already underway, and pilots have already seen Chinese consumers splurge 10 billion in digital yuan. While watchdogs have much to win, and operators have less to lose, 2022 will be the year when the new digital currency will enter casinos, Reuters concluded. MDT
