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Venezuela- Humbolt hotel in Caracas opens cryptocurrency only casino

By - 20 January 2020

The Venezuelan government has authorised the operation of a casino at the Humbolt hotel in Caracas where all bets will be processed in petro, the country’s national digital currency.

Venezuelan President Nicolás Maduro made the announcement on Friday pointing out that all the funds raised will be allocated to social investment in areas such as education and health.

During a joint state radio and television broadcast, President Maduro said he had authorised bets via petro in order to obtain additional resources.

The new measure is the latest attempt related to the use of digital currency in order to boost the country’s beleaguered economy.

“I have authorised legal bets on petro. For example, in the hotel Humbolt, here will be an international casino and everyone who wants to bet will bet via petro, all those resources will enter the State for health and education, in convertible currency. You can come to bet, there will be offers, special prices. You buy your petro, you can buy it if you bring Yuan, if you bring yen, dollars, Euros or any other crypto currency. You can buy your petros and make your lawful bets allowed by the state as covered by national laws,” President Maduro said.

However the government did not offer many other details about the use of petro and other crypto currencies such as Bitcoins in the casino and left many other questions unanswered. The Venezuelan government launched its digital coin in 2018, as a defence against U.S. sanctions that have cut off Venezuela from international capital markets. It is backed by the country’s oil reserves, the world’s largest. The country remains in a deep economic crisis amid widespread corruption, a devalued currency and crippling sanctions by the US and the EU.

Hugo Chavez’s successor Nicolas Maduro has been equally as critical of the industry as his predecessor. The Venezuelan gaming landscape has seen a remarkable transformation since 1996. In 1996 the market looked potentially lucrative for operators as Venezuela passed a gaming law which allowed for casinos to be built in five star hotels with a minimum of 200 rooms. In common with many gaming laws in South America the main purpose of casinos would be to encourage tourism and add to tourist infrastructure in the region. It was estimated that within a very short time at least thirty new casinos would be up and running in Venezuela and casinos and bingo halls would only be permitted once locals approved of their establishment via a referendum and bingo halls would be permitted as long as they were part of a hotel.

Three years after the act was passed and Hugo Chavez was elected to power. Chavez did not ban casinos or bingo outright but the industry saw a great number of closures during his fourteen year long rule which saw huge tax increases across the bingo and casino sector. Combined the closures left an estimated 100,000 people in the industry out of work. Although the crackdown began slowly it went into overdrive in 2011 after the National Commission of Casinos, Bingo Halls and Slot Machines under the Ministry of Justice was given powers over the industry whereas before local governments were allowed to approve casinos and bingo halls.

Since its establishment the commission has carried out numerous onsite inspections and raids which have almost always ended in closures. These closures continued apace especially in 2011 when the Commission closed down almost all of the bingo halls and slot parlours in the country and revoked licences which had been granted by local authorities.

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