A major underground online casino operation in Kokang, Shan State, Myanmar, was shut down in December 2023 following an intensification of armed conflict, according to a report published by the United Nations Office on Drugs and Crime (UNODC) on 15 January 20241. The operation ran on USDT, a cryptocurrency pegged to the US dollar, and was identified in the report as one of the cases illustrating how illegal online casinos are used to move and launder money in East and Southeast Asia1.
The report, titled "Casinos, Money Laundering, Underground Banking, and Transnational Organized Crime in East and Southeast Asia: A Hidden, Accelerating Threat," was issued in Bangkok1. It found that casinos, junkets and cryptocurrency have become a critical part of the underground banking and money laundering infrastructure in the region, fueling transnational organized crime1. UNODC said the study was developed through examination of criminal indictments, case records, court filings and other data collected in consultation with authorities and partners over more than a year, and through mapping thousands of "gray and black business" online groups on the clear web and dark web1.
"Major USDT-based underground online casino operation in Kokang, Shan State, Myanmar, 2023 (shut down in December following intensification of armed conflict)."
The report gives wider figures for the sector. UNODC analysis estimates there were more than 340 licensed and unlicensed land-based casinos operating in Southeast Asia as of early 2022, with most having shifted online to offer live-dealer streaming and proxy betting services1. The formal online gambling market is projected to grow to more than US $205 billion by 2030, with Asia Pacific representing the largest share of market growth between 2022 and 2026 at a projected 37%1.
| Item | Figure | Source |
|---|---|---|
| Land-based casinos in Southeast Asia, early 2022 | More than 340, licensed and unlicensed | 1 |
| Formal online gambling market, projected 2030 | More than US $205 billion | 1 |
| Asia Pacific share of market growth, 2022 to 2026 | Projected 37% | 1 |
The report also describes how illegal online casino operators have diversified into cyberfraud and cryptocurrency laundering, with evidence of organized crime influence within casino compounds, special economic zones and border areas, including areas controlled by armed groups in Myanmar used to conceal illicit activities1. UNODC Regional Representative Jeremy Douglas said operations against syndicates in countries including Cambodia and the Philippines had caused a partial displacement, with criminals moving infrastructure to remote and border areas of the Mekong and elsewhere1.
What it means for players
The Kokang operation was an unlicensed, underground venue rather than a regulated one, and its closure was a side effect of fighting rather than a regulatory action1. For players, that distinction matters: money held on such a platform sits outside any licensing framework, and there is no reported process for recovering deposits or balances after a shutdown. The report does not say what happened to player funds, accounts or data tied to the Kokang operation, and no such detail has been reported1. The wider finding that most Southeast Asian casinos have moved online into live-dealer streaming and proxy betting means the platforms players encounter may be operated from conflict-affected or armed-group-controlled areas, where oversight is limited1. UNODC's report does not name individual sites or set out player-facing protections1. General background on how these hubs work and how risk differs between licensed and unlicensed operators is covered in Online Gambling Hubs in Asia and What Their Shutdown Means for Players and Licensed vs Unlicensed Online Casino: How Risk Differs.
What happens next
The report lists recommendations aimed at strengthening knowledge and awareness, legislation and policy, and enforcement and regulatory responses in the region, intended to assist governments1.
UNODC Deputy Regional Representative Benedikt Hofmann said the report is intended as a reference for deeper engagement between countries in Southeast Asia, UNODC and international partners, adding that "at this point, we are just scratching the surface"1. No specific enforcement action, timeline or follow-up targeting the Kokang operation has been reported1.
