I"m no magician but I've always loved to come up with theories as to how magic tricks are done. If you notice, the magician never exposes the top side of his right hand throughout the entire routine. That tells me he probably had some type of gimmicked knife affect attached to his hand the entire routine. He has four cups. The top cup was probably marked in someway- an X, a dot, etc. The cup with the real knife was covered with the marked cup. After spinning the roulette table, the magician safely slams his hand down on one of the three remaining cups that are not marked, thus exposing the top of his hand right hand, which exposes the gimmicked knife, thus giving the illusion of the knife slicing through his hand. This is my theory, I could be wrong.