BUSINESS

China warns live-streamers to knock off the gambling

TAGs: China, Live Streaming

china-live-streaming-gambling-crackdownChina has gone mad for live streaming but some streamers have earned the ire of the authorities for allegedly conducting illegal gambling.

A report by Chinese consulting company iiMedia Research put the number of China’s live-streaming platform users at over 312m by the end of 2016. There are over 200 live-streaming apps and platforms, even after China imposed new restrictions on their use last year, including requiring all performers to register with the authorities.

Some of China’s more extroverted performers have become online stars, and fans have a variety of ways in which to interact live with the performers, including sending them virtual gifts. And here’s where things get messy.

According to a report in the state-owned English-language China Daily, an online platform called Xingqiu has been hiring young women to host live-streamed guessing competitions and soliciting virtual gifts from viewers who wish to submit guesses.

The organizers of the competitions reportedly believe they’re not breaking China’s strict prohibition of gambling – be it online or land-based – since the prizes awarded to players who guess correctly are also paid in virtual gifts, ergo, no real money is changing hands.

But the report indicated that an “underground chain” exists that allows the hosts to redeem the virtual gifts for real cash, which is then returned to the winning viewers. The process seems modeled on Japan’s ubiquitous pachinko parlors, where players can only collect winnings in the form of little silver balls, which can be exchanged for cash at an associated vendor conveniently located just off the pachinko premises.

The China Daily report minces no words as to the legality of this type of under-the-table exchange, saying the organizers “have obviously committed a crime.” The report invited the judiciary to “take an interest in the broadcasts” while calling for certain government departments to be given “power and responsibility to better supervise these platforms to end the chaos in the live broadcast market.”

China isn’t the only Asian nation battling gambling operators with a penchant for live-streaming. In February, a Thailand live-streaming star was arrested for performing a strip tease for viewers to promote an online betting site.

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