In the 1800s, Portuguese colonists legalized gambling on a sleepy Chinese island called Macau. That once-lolling backwater has become a glittering center for tourism in Asia, with an estimated $40 billion to $45 billion in revenue this year, according to Union Gaming Advisors, a Las Vegas based consulting firm.
Nearly two centuries later, Matsu, another island formation off China's coast, wants to grab a piece of Asia's rapid growth in gaming.
But this time, big investors such as Bill Weidner, the former president of Las Vegas Sands, are leading the resort development. (Weidner had a bad break with Sands Chairman and CEO Sheldon Adelson, ultimately testifying against the gaming magnate in a breach of contract suit.)
Controlled by Taiwan, the Matsu archipelago is known mainly as a military outpost in Taiwan and China's ongoing standoff, and as a remote tourist destination.
"It's a beautiful place for birdwatching," said Kuang S. Yeh, Taiwan's minister of transportation and communications. "And it has very special military bases, which is interesting for tourists."
After Chinese nationalist troops retreated to Taiwan from the mainland in 1949, the bases on Matsu—some as near as 5.5 miles from the People's Republic—became a symbolic front line.
The union of blackjack players and bird-watchers came closer to reality when Matsu's 10,000 residents voted last year to allow casino gambling on their islands. A bill to legalize gambling is now being reviewed by Taiwan's Legislature.
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Yeh said it has an 80 percent to 90 percent chance of approval.
"If we can pass it by the end of this year or early next year, then I would say we start operating around 2019," Yeh said. "There are currently only 100,000 tourists visiting Matsu this year, but we don't know how much new tourism would come—at least 10 times more."
Weidner has pledged to invest $2 billion in a casino resort in the archipelago through his Global Gaming Asset Management (GGAM) group. That's equal to what Matsu would generate annually in gaming revenue, according to Grant Govertsen, a managing director at Union Gaming Advisors.
Weidner declined to comment for this article.
It remains a risky bet, largely because it hinges on attracting gamblers from the mainland, who are nearer Matsu than are residents of Taiwan.
"It would be almost as easy for Taiwanese customers to fly to Macau as to fly to Matsu," Govertsen said. "You're entirely betting your success on mainlanders."
Another threat is regional competition from Japan, South Korea and Singapore (think of Macau as Las Vegas and other places as convenience markets competing for a smaller share of the mainland market).
"They all want to attract the people from mainland China," said Leon Liao, a Hong Kong-based gaming analyst at Jefferies.
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There is also a new conflict with China that could sink the dreams of Weidner and others looking to place bets on Matsu. For a few years, the Chinese government has said it may not allow its citizens to visit future gaming venues there, according to local reports from Asia. The rhetoric behind that potential maneuver could heat up as Taiwan considers its vote on Matsu.
"Communist China's policy is that it's illegal, it's unethical to have gambling," Yeh said. "However, there's a conflict there because they allow mainland Chinese to go to Macau for gambling. That's inconsistent."
Govertsen said, "If you're Beijing, you much prefer your citizens to go to Macau, which is part of China, where you know who's there and have control over it. It's not necessarily a guarantee of 'if you build it, they will come.' "
The need for sturdier infrastructure on the sparsely populated island group, which maintains two small commercial airports, is also an issue.
"There's nothing there," said Liao at Jefferies. "If you want to build a casino, you have to build up all the infrastructure. Highways and airports. There's no apparatus for getting the people in."
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Resort developers such as Weidner would cover the costs for such projects up front, according to Yeh.
"Potential investors commit to build an airport, and in the future, the local government needs to give them payback through tax," he said.
Partly because of such obstacles, larger casino operators have so far passed on the chance to develop on Matsu, said Alan Feldman, an executive vice president at MGM Resorts.
"We spent a considerable amount of time in Taiwan, and it was our view that the likelihood of success was far greater on the main island than on many of the outlying islands," he said. "It wasn't that they weren't in and of themselves fine places, but they were ... remote and really relied almost exclusively on tourists."
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Still, Feldman said, he's not ready to say Weidner has played a bad hand or is bluffing on his Matsu plans just yet. GGAM has operations in Las Vegas, Macau, Taiwan and India. It is also involved with a Bahamian development called Baha Mar, and in managing a resort in the Philippines called Solaire.
"Bill's an incredibly smart man, and I wouldn't second-guess his view of something," Feldman said. "If you have an appealing urban resort or a resort along the beach, if you create the proper welcome, people will come. Will they come necessarily out of their way? Maybe, maybe not."
—By Adam Molon, CNBC News Associate. Follow him on Twitter