To be funded through ICO
The CEO of the Hong Kong-based Dragon Corp. tells Macau News the company will fund its planned floating casino through a virtual token initial coin offering that launched December 8.
Chakrit Ahmad said the cruise, to be called Dragon Pearl, will open in early to mid-2021. It will be developed in part with funds raised by the group’s ICO; Dragon Group hopes to raise more than US$400 million (MOP3.21 billion) through the effort, with three-quarters going to the water-based resort.
“Most of the raised money will be kept as a reserve so that the platform can work,” added Ahmad. “Part of it will be used to fund the casino.”
The Dragon Pearl has been described as a “flagship hotel/casino in Macau that is floating, static anchored, eco-friendly and cashless,” using only the company’s virtual tokens as currency. Norwegian shipbuilder Brova Idea AS will build the floating structure, which also will feature a hotel.
Ahmad said getting a gaming license in the jurisdiction may take more time than usual as the property will be “the first of its kind.” He added that the company has “alternative locations planned as well, as a precaution.” The property will include 16,000 square meters (172,000 square feet) of gaming floor; 400 luxury guest rooms and suites; restaurants and retail spaces; a pool and spa; sports arenas and a parking facility. A vehicle and pedestrian causeway will provide access from the mainland to the casino off Nam Vam Lake.
ICOs are becoming a popular way to raise money, reported Reuters because the issuer can raise funds without having to observe strict regulatory requirements. But there is concern in the marketplace that the practice of fundraising with cryptocurrencies is a risky business that lacks transparency. ICOs and bitcoin are banned in Mainland China.
If the ICO “facilitates funds moving out from China, it is subject to China’s view on it,” said Ben Lee, managing partner at Macau-based consultancy IGamiX. “It is clearly aimed at mainland players, who make up 90 percent of gaming volumes, giving them a digital way to circumvent the country’s forex controls.” It’s just the kind of outflows the Chinese government has been cracking down on.
The Macau Monetary Authority has informed financial institutions they may not provide services directly or indirectly for tokens and virtual currencies due to the risks of money laundering and terrorist financing, Reuters reported. Macau’s Gambling Inspection and Coordination Bureau had no immediate comment.
