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Is Khalid Samad’s Harapan Coin ICO Legitimate?

by Ellia Pikri
BLOCKCHAIN/CROWDFUNDING

Both the political and the cryptocurrency spheres alike are talking about the Harapan Coin, a donation token endorsed by Khalid Abdul Samad—our current Federal Territories Minister. It was created as a fundraising coin for the Pakatan Harapan coalition to combat Barisan Nasional in the 14th General Elections.

According to Malay Mail, Khalid has expressed an interest in bringing up the Harapan Coin, originally a personal project, in an upcoming PH Presidential Council’s next meeting.

At the time of writing, the Pakatan Harapan government has not expressed any opinions or endorsement of the Harapan Coin, apart from Khalid Samad who intended to use the coin to garner donations for his Parti Amanah Negara, member of the Pakatan Harapan coalition.

After all, the government would probably not want to endorse a coin if the regulatory body has consistently had a “buyers beware” stance on cryptocurrency

Seeing that the Harapan Coin is a relatively unique presence in any market, we thought that it would be worthwhile to look into this coin that has recently garnered interest and outline some discoveries.

Here are our findings:

Disclaimer: The Harapan Coin was initially issued to raise funds prior to the Pakatan Harapan victory at GE14, and there are no discussions on whether they will continue it or not. All information presented is about the coin’s intentions before the elections.

1. The Website
The coin came into being partly because it was otherwise difficult for those outside of Malaysia to transfer large sums into the then-opposition’s wallet. BNM would curb any suspicious transactions from coming in overseas, according to one of the core team members of Harapan Coin.

The Harapan Coin website indicates that out of the intended US$120,000,000.00 they hoped on raising, they gained a total of USD2,548.44.

That’s less than 1 percent than the amount they hoped to raise.

There was interest in turning the Harapan Coin into a legitimate currency in Malaysia, but this is probably unlikely any time soon, as BNM and Securities Commission has not expressed any endorsement or legalization of cryptocurrency be it as payments instrument or a securities token at the time of writing, and seem wary of raising ICOs in Malaysia.

Another noteworthy mention is that the Harapan Coin is paired with USD, and sold in packages. While in most cases ICOs are paired with ETH it is not uncommon for some to be tied with USD.

Based on Khalid Samad’s statement in the video, 30 percent of the funds were to be given to the developer, 30 percent for the Parti Amanah Negara, and the rest was to be given for Pakatan Harapan.

Though in a Facebook post, the developers claim that they will not be taking their own cut of the donations raised.

Some netizens have wondered about the legitimacy of the video. The editing choices that would have made it easy for an unscrupulous scammer to put words into his mouth. As far as Fintech News Malaysia is able to verify though, the Harapan Coin is indeed endorsed by Khalid.

3. The White Paper
The first issue we found when delving into the white paper is that it takes 22 pages before you get to any concrete information about the Harapan Coin, or HRP. The white paper was seemingly too concerned with explaining the Malaysian political history in detail, and outlining a beginner-friendly guide on decentralization, ICOs, and why Blockchain is incorruptible.

Many ICO white papers choose to assume that people already understand what those in the know consider basic information. For example, when we looked at HelloGold’s ICO white paper, it only takes them two pages of backstory and company information before they delve into technical details of the coin.

That being said, we admit that this practice is not unheard of. DAOstack’s successful ICO, which only took 66 seconds to sell out, detailed what Blockchain and decentralization actually mean, though they did also go into more technical details about the coin later on, which the HRP notably lacks.

Considering that this coin is intended for those already interested in Malaysian politics, perhaps it could have stood without a crash course into Malaysian political history, and instead focused on the problem at hand that the HRP was trying to solve as well as the underlying technology.

4. The Marketing
It was always made clear that the coin exists for donation purposes, rather than rewards. One of the core team members reportedly wanted to send in a “huge amount of money” for GE13, but Bank Negara stopped the money from reaching Malaysia, in a bid to stop suspicious money coming from overseas.

This Harapan Coin was intended as a decentralized solution that could circumvent such problems.

And with the general elections coming up at the time with a deadline, the intended recipient might not have the time required to go through the bureaucratic red tape to get those donations in time, which perhaps in Khalid’s thoughts, necessitated the coin.

That being said, some of the more recent marketing strategies do concern us slightly, particularly with statements like “Harapan Coin will fly high. Do not regret for not buying now!” posted on the 6th of July.

Since the Harapan Coin was always intended to be a method of donation, the rewards structure is a tad unclear and perhaps pending Khalid’s talks with the ruling government.

5. The Team

Since the coin’s inception, the Harapan Coin team has remained mysterious, which according to their website is “for utmost security as not wanting to be tracked by BN Malaysia’s special branch department, we have no choice but to blur our facial pictures”.

The flags accompanying each name and blurred photo seem to indicate where these developers are currently residing in. We doubt that the authorities in these countries would allow the then-ruling Barisan Nasional government to take action against these individuals as long as they are there. That being said, we could perhaps give them the benefit of the doubt that they’d rather be safe than sorry.

# # #

All in all, this coin ended up appearing more legitimate than we initially anticipated when we first heard of it. That being said, we also understand why the coin might not have been as celebrated as the team and the minister might have initially hoped.

A mysterious team perhaps did not help matters much, ringing ‘scam’ bells for many who would otherwise be interested. And with a white paper that was vague on the technology underlying the coin, investors were predictably unsure, and perhaps fearing that their donation would go into the pockets of scammy developers, held back.

It bears repeating that BNM wants Malaysians to be wary of any ICOs they may want to buy. As such, it might be unwise for a political coalition to affiliate themselves to a cryptocurrency.

So Khalid Samad may have the best of intentions when the Harapan Coin promises were made, but others in the ruling government might not be too keen on it.

It’s heartening to see someone in the administration looking into new technology, but it would perhaps be fruitful to study what are some triggers into the new market one is exploring, and how you would present yourself as a legitimate extension of your efforts. - Featured Image Credit: Yahoo News Singapore

https://youtu.be/lArZ9qI7hzo

Tycoon Vincent Tan 'categorically denies' investment in blockchain tech project

KUALA LUMPUR: Tycoon Tan Sri Vincent Tan Chee Yioun has categorically denied a recent NMDRP online report which said he had invested half of his wealth into a new project that was "to take the world of Blockchain technology by storm".

"I would like to categorically deny that I have made an investment in this project or that I am in any way involved in it. There is absolutely no truth in this report which I believe has been put out by unscrupulous persons to deceive the public," he said in a short statement.

"This is not the first time my name has been used without my knowledge or authority for the purpose of lending credibility to online investment scams, and it is likely that it will not be the last. I have reported this matter to the relevant authorities so that appropriate action can be taken," he added.

Tan also advised the public to be wary of promises of quick riches so as not to fall prey to scams like this.

Entitled “Vincent Tan gives back to the people with his latest project”, the report said Tan was investing US$250 million in The Formula project and had hired a non-Malay technology chief executive officer named Austin Ford to run it.

The article also claimed that The Formula, supposedly a share trading platform, utilizes an algorithm that allows trades executed through it to beat the stock market with an accuracy of 80 percent and thereby allow users to make huge profits. - theedgemarkets.com

Note - According to Wikipedia, Tan Sri Vincent Tan Chee Yioun is a Malaysian businessman and investor. He is the founder of Berjaya Corporation Berhad, a diversified conglomerate listed ..

Alibaba Seeks Patent for Blockchain that Allows ‘Administrator Intervention’

Chinese e-commerce giant Alibaba has applied to patent a blockchain system that allows a third-party administrator to execute “special transactions” such as halting a smart contract or freezing an account linked to illegal activity.

According to documents made public recently by the U.S. Patent & Trademark Office (USPTO), the Hangzhou-based firm submitted the application through Alibaba Group Holding Limited, a holding company located in Grand Cayman, in March.

Writing in the filing, the patent authors state that while Blockchain technology has many attractive features — openness, unchangeability, and decentralization, for instance — it fails to account for certain practical considerations associated with implementing it in a regulated, real-world environment.

In particular, the Alibaba researchers expressed concern that standard smart contracts do not provide legal authorities with a general ability to freeze user accounts associated with illegal transactions or otherwise facilitate administrative intervention in a Blockchain network.

From the patent application:

“In real life, however, there is a type of administrative intervention activities in the category of special transactions. For example, when a user performs illegal activities, a court order may be executed to freeze the user’s account. However, this operation activity conflicts with smart contracts in existing Blockchains and cannot be carried out,” the patent authors wrote. “Therefore, there is a need for a Blockchain-based transaction processing method that enables special transactions like administrative intervention in a Blockchain.”

Under Alibaba’s proposed Blockchain system, dedicated administrator accounts would have the ability to send so-called “special transactions” to nodes, which then invoke a smart contract to perform operating instructions on a particular account.

In one potential embodiment, the Blockchain creator could issue an account to a government agency that allowed the agency to invoke a smart contract that performs a predefined set of interventions corresponding to their legal or regulatory mandate.

The authors wrote:

“Here, the issuing account recorded in the various embodiments may be an account owned by a government agency or a trustful institution. Since corresponding smart contracts are created for different designated accounts, it indicates that operating instructions issued by the designated accounts are recognized. As a result, effective administrative supervision can be performed on all accounts in a Blockchain network, and this type of supervision is limited, which will not restrict normal transactions in the Blockchain network.”

The authors concede that this system introduces an element of risk into the Blockchain network since administrator accounts could be prime targets for hackers. Consequently, they suggest decentralizing supervisory power among a plurality of designated accounts.

“In this way, the supervision power of the accounts in the Blockchain can be decentralization, such that the supervision power against the Blockchain is not centralized in one designated account and the effectiveness and credibility of supervision can be ensured,” they wrote. “At the same time, it prevents the loss of all supervision power over the Blockchain when one designated account is compromised.

Even apart from Alibaba’s proposed system, smart contract developers can generally write contracts that give them some degree of control over those contracts after they have been deployed. In Ethereum, for instance, developers can create “upgradeable contracts” that separate logic and data into separate contracts, one of which calls the other, often with the use of delegate call and a so-called proxy contract. When creating its stable coin, cryptocurrency exchange Gemini implemented a proxy contract to enable it to freeze tokens held by suspected criminals and otherwise comply with financial regulations. However, developers warn that creating upgradeable contracts significantly increases the complexity of the code, raising the likelihood of bugs.

Alibaba’s proposed system would not only reduce the complexity associated with giving administrators extraordinary privileges but would also give them the ability to perform these actions over the entire network, not just on a particular token or smart contract. - CCN Blockchain News - Image from Shutterstock