Hold your horses on digital currency, MSWG tells Country Heights

PETALING JAYA: Country Heights Holdings Bhd (CHHB) shareholders’ approval last Thursday was merely an approval-in-principle for it to seek support to “embark” on its initial coin offering (ICO) known as “Horse Currency”, said the Minority Shareholders Watch Group (MSWG).

In its weekly newsletter, MSWG said many details are not yet available to the shareholders, especially the regulatory framework for such ICO.

“CHHB is in the process of mobilising its team of experts and advisers to fine-tune the ICO offering and this will incur costs.”

MSWG cautioned that there is a risk that some of the money that is spent on the ICO journey that CHHB is embarking on may have to be written off if the regulatorily-approved ICO model turns out to be a “different animal” (maybe the same animal but with different features).

Nonetheless, it expects CHHB to provide sufficient details in the future to enable shareholders to make an informed decision on the ICO offering.

MSWG has raised a few concerns over the ICO exercise such as how would it be treated in its books – either equity or loan or a hybrid of these; risk management measures and framework to be established; how will the ICO ranks if there is a winding-up; will minority shareholders get a “restricted offer” at a lower price; and the risk of the success of the ICO given that CHHB is primarily involved in property sector, which is currently facing severe headwinds and overhang.

To recap, CHHB is planning to issue one billion units of Horse Currency backed by RM2 billion worth of assets held by the holding company with an initial 300 million open to the public for circulation. Its 20-member task force will continue to engage with regulators such as Bursa Malaysia, the Securities Commission, Bank Negara Malaysia as well as the Malaysia Blockchain Association.


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