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Bitcoin Gambling Laws: South Korea

Visiting Kangwonland, the hotel cum casino complex located strategically in the Korean mountains, you get an impression that Koreans truly love their game.
The place is a beehive of activities with players busy enjoying roulette games, slot machines, blackjack, and a myriad other casino games.

Watching their excited faces, it would be hard to believe that their Government isn’t as happy with Korean gamblers. But that’s, in reality, the truth. In fact, the Korean National Gaming Control Commission doesn’t allow anyone else into the arena and the hyper-active Kangwonland is mainly the only game in town.

Well, Koreans can play some lottery, engage in horse racing, and powerboat or cycle racing but generally, South Koreans don’t have much leeway when it comes to following their favorite pastime as far as Casinos are concerned. Even more interesting, the Korean laws prohibit the nationals from gambling even when outside the country seemingly trusting the long arm of the law to somehow catch up with the offending citizens.

Also, like in China, the law outlaws online gambling.

The Main Statutes

The government, driven by a passionate desire to make gaming a sound leisure industry has over the years passed several laws to reduce the adverse effects of gambling and to police illegal gaming operations.

These includes Acts No. 8279, 8852, 11426, 11530, 11690, and 12844 in between the year 2007 to 2014 some of which were enacted to amend older statutes.

Though the National Gambling Control Commission legislation is the dominant law, some of these laws are quite specific:

Casinos are also controlled by the Korean Tourism promotion act and some provisions coming from special acts such as the act on assisting abandoned mine areas to develop.

Similarly, horse racing falls mainly under the country’s racing association act while both motorboat and Bicycle Racing are supervised by the bicycle & motorboat racing act.

For lotteries, you have to refer to the lottery tickets & lottery fund act with bullfighting- a much-loved ancient Korean hobby being controlled by the traditional bullfighting act.

There is also the South Korean national sports promotion regulation which oversea sports betting and promotion act.

The net effect is a strictly controlled betting environment for the locals and subsequently, a widespread illegal gambling problem as people search for alternatives.

Online Gambling Is Illegal

The authorities are very much alive to the fact that the craze for internet gambling has been spreading like bush fire globally and have acted criminalizing online betting and making it illegal for anyone to run any sort of internet betting business from South Korea.

But this was always to be a hard task considering the country’s advanced internet infrastructure. And so, in spite of the Korean people being aware that internet gaming is illegal; many have been shifting their quest for pleasure online.

Some crafty nationals have even dared to operate gaming websites from within the “land of morning calm” much to the chagrin of the authorities who have in turn acted ruthlessly by mounting occasional raids and shutting down the facilities.

The government doesn’t stop there:

It also works hard to limit the access of Koreans to offshore websites by blocking IPs associated with suspected sites. But the citizens are technologically savvy and some have resorted to using VPNs to bypass the IP restrictions to their favored platforms.

Maybe this is what has pushed some South Korean’s to seek a safe haven in some neighboring online betting friendly countries such as Thailand.

But again, and with this in mind, the authorities have been collaborating with their counterparts in Bangkok (and elsewhere) by sharing classified information and have occasionally succeeded to have some of the perpetrators arrested.

Foreigners Are Free to Gamble

Funny enough, the country doesn’t mete out the same harsh treatment on visiting foreigners. Visitors are free to bet on any podium- from placing online bets, Bitcoin gambling on websites such as Fortune Jack, and all the way to playing poker, it’s a free for all as far as tourists are concerned.

This explains the presence of multiple brick-and-mortar casinos in and around Seoul and other cities. These casinos have perfected the art of marketing and you will notice the large banners inviting you to a winning experience as you walk around.

As expected, local gamers, fear the consequences of being caught playing in these casinos and totally keep off.

So, why is the Korean government promoting gambling to foreigners while cracking down on its own citizenry?

The answer to this question lies in the lucrative tourism industry. South Korea has been a leading tourist destination globally for the past 20 years and jealously guards its market. It’s in an effort to try and pull in more visitors that perhaps makes it open up the betting industry.

Bitcoin Status in South Korea

Cryptos, especially the Bitcoin and Ether, have been on fire in the South Korean market with many ordinary South Koreans rushing to mobile-app based cryptocurrency exchanges in the hunt for profits.

The unprecedented crypto explosion has caused alarm within the corridors of power prompting the Financial Services Commission (FSC), the financial regulator, to caution citizens against blindly investing in the Bitcoin in addition to commencing investigations in Crypto trading accounts held by crypto exchanges in various banks.

But few have been heeding the call and now the justice ministry is actively pressurizing lawmakers to pass the Cryptocurrency and blockchain Bill it brought for parliamentary debate earlier in the year.

The Prime Minister, Mr. Lee Nak-yeon has also expressed his government’s concerns that cryptocurrencies might attract more youth to money laundering and other crime.

Prime Minister Mr. Lee Nak-yeon

If successful, the clampdown on the Bitcoin in South Korea under its Cyber cyber security laws is expected to have devastating effects not only on the websites offering Bitcoin gambling to South Koreans including the Bitcasino.io -which has recently added Ethereum on its website- but potentially also on the greater Crypto trade around the world.

 

To show its seriousness, the police in South Korea has stepped up their scrutiny into crypto exchanges with the popular Coin One recently being found guilty of promoting the banned Bitcoin margin trading.

While this happens,  more stakeholders are waking up to the realization that the Bitcoin gambling market is set for growth (despite the teething challenges) and are entering into shrewd partnerships left, right, and center as they prepare for the predicted boom.

For instance, Softgamings and iSoftBet have inked a deal that will hopefully open up more Bitcoin gambling opportunities worldwide in the near future.

Summary and Predictions

The South Korean gaming arena is a bit strange. The state won’t allow its citizens to play yet it goes all out to woo foreigners to bet in the numerous licensed land-based casinos.

The state’s national gaming & control commission also works round the clock to prevent the citizens from accessing the outlawed offshore Bitcoin gambling sites despite their popularity amongst Korean gamers. And so it has been predicted that thousands of tech-savvy bettors use VPNs to bypass the IP restrictions on these sites and play.

Worryingly, the Ministry of Justice has introduced several cryptocurrency laws in the Korean national assembly which, if passed, could make the play even more difficult especially as the proposals are targeting the all-important virtual currency exchanges. And, while South Korean players have a knack to weather various storms, it remains to be seen how they will navigate this fast approaching hurricane. In the meantime, play continues in Kangwonland and elsewhere.

 

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