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[Hong Kong 3rd Reuters BREAKINGVIEWS]- Digital currencies can undermine the brilliance of Macau. In Macao SAR, mobile payments increased fivefold during 2020. China also wants to experiment with new digital currencies in the region. The expansion of digital currencies will also facilitate “surveillance” by regulators. This is why some gambling and casino enthusiasts are reluctant.
Regulators will be hit the hardest by the use of digital technology in casinos, where gambling enthusiasts like Win Resort and Galaxy Entertainment flock.
Gambling spending by mainland Chinese tourists has become a mainstay of support for the Macau economy. But they are already familiar with online payment applications like Alipay.
In addition, the new coronavirus COVID-19 has further increased the number of consumers who prefer contactless transactions and avoid physical tickets. Last year, the use of mobile payments in Macau increased by more than 400% to just over 6 billion MOP ($ 750 million), according to the Macau Financial Administration.
Meanwhile, the People’s Bank of China is working on the “digital yuan.” In August last year, the Chinese Ministry of Commerce announced that it would test the digital yuan, a new traceable currency, in the former Portuguese colony of Macao. With digital currencies available in casinos, greater transparency will help authorities track capital movements and conduct anti-corruption investigations, including in Macau, the gambling center.
Tax evasion of personal income tax is a daily occurrence in China. According to officials reported in The Economist, only 2% of the population pays personal income tax.
That’s why a system that allows authorities to track the flow of money is inconvenient for high-value casino patrons and the public spending abuse trails that fund their gambling. On the casino side, there is almost no incentive to impose such problems on customers, and the Macau administration is also nervous. In December last year, there was a negative reaction to the Bloomberg report that Macau casino regulators would test Chinese electronic currencies.
If the Chinese government is betting on digital currencies, Macau will bet even small amounts, knowing that a large number of tourists in general from mainland China will have control of the amount of the bet and the winnings. I have to wait for it to be removed.
Fortunately, there is a good way to get smaller casino customers. Macau’s most profitable customers are no longer expensive gamblers. At the end of 2019, for the first time in history, the contribution of the mass market, or small general customers, outpaced high-value bettors in both casino sales and net income. Betting on less conspicuous customers can result in higher payouts.
-January gambling-related revenue in Macau fell 63.7% year-on-year, according to official data from February 1. Macau, the world’s largest casino hub, is struggling to attract customers from its main market, mainland China.
-Bloomberg reported on December 2 last year that Macau’s gambling regulator DICJ (Hakusai Office of Inspection and Coordination) will test-introduce China’s digital yuan, DICJ will buy digital currency tokens. He denies checking with the casino operator to see if it can be used.
-In August last year, the Chinese Ministry of Commerce announced its intention to conduct a trial introduction plan for the digital yuan in Macau and other parts of the country.
(Translation: Acrelen)
