Cutting the Costs For Macau VIP Gaming

Macau brings in an average $3 billion USD gross gaming revenue (GGR) per month and about 56% of this GGR comes from the VIP gaming market. 

In October 2017, the GGR reach a 3 year high of $3.3billion after more than 2 years of downward spiral that followed China’s anti-corruption drive in 2014. 

More information about the growth in GRR in this article from Reuters:

https://www.reuters.com/article/fitch-macau-gaming-revenue-expected-to-g/fitch-macau-gaming-revenue-expected-to-grow-12-in-2017-idUSFit995580

The VIP gaming market is critical to the entire casino industry in Macau as well as to her economy. 

VIP gaming is also commonly known as Junkets, as VIP gamers do not gamble in the public spaces of the casino floors. Instead these VIP gamers have their fun in private rooms within the casino; these rooms are known as Junkets. 

In Junkets, bets on the most popular game Baccarat can go as high as HK$ 2million and daily volumes can be as high as HK$2 billion. 

VIP gamers come from all over the world to Macau to gamble in these Junkets as they are rewarded with luxury suites and are wine and dine with luxurious food cooked by top chefs. 

But VIP gaming involved many middlemen and agents who facilitate transfer of the large funds of the VIP gamers from their home country to Macau. 

The inbound transfers is usually borne by the Junket Operators and can be as high as 5% while the transfer of winnings back to the VIP gamers’ home can cost as high as 7%. A few hundred millions dollars a month goes to such middlemen.

Hence Innovations in cost cutting for VIP gaming is highly welcome and Dragon Inc is a company that aims to do just that. 

Dragon Inc wants to bring the cost for funds movement down to 1% for the Junket operators and the VIP gamers. 

Naturally this will be very attractive to the Junket operators as well as the VIP gamers. Junket operators will be able to reduce his cash 

Dragon Inc has highly ambitious goal and wants to launch an ICO that will become one of the biggest in 2017 by aiming for more than $400 million. 

And it seems that Dragon Inc, which is lead by CEO Chakrit (Chris) Ahmad, is already more than halfway to achieving their target. 

The company has signed contracts with 4 junket operators in Macau and they have jointly committed to US$265 million of the ICO. (Reference: https://www.cnbc.com/2017/09/24/macau-company-aims-to-raise-500-million-in-ico-despite-china-ban.html)

The coins for this ICO is Dragon Coins DRG and 500,000,000 DRG will be minted through the ICO. 

However Dragon Inc will be implementing a burn program. This burn program is called the Dragon Coin Buyback Mechanism and each month part of the profits from the Dragon junkets will be used to buy back DRG and burned. 

You can learn more about the Buyback Mechanism in this video: 

DRG is not only a coin to be held by investors but it is also to be used for junket operators to exchange between fiat as well as other cryptocurrencies. 

In addition, DRG will be used to change for Dragon Global Chips DGC in the Dragon Junkets as well as Dragon affiliated junkets. 

DGC will be the coin that can be used to exchange to gambling chips at the junkets. DGC will be pegged to fiat for example DGC-HK will be pegged to HK$1.00 so that gamers can gamble with DGC at the junkets or affiliated junket.

This ICO is interesting enough to keep me reading their entire whitepaper. With their expected burn program as well as the high expected demand of DGC by junket operators and VIP gamers, DRG will likely see huge success.