An initial offering for the government’s planned Harapan Coin project has failed to state an actual “value” for its buyers, a digital technology consultant said today.

Fabian Narcis, who is a cryptocurrency trader, told Malaysiakini that this raises questions on why buyers should invest in Harapan Coin, which was first launched in January with a stated intention to raise funds for the then federal opposition pact’s 14th general election campaign.

“What is the value of this cryptocurrency and how would it benefit the people using its technology?

“For example, if I have cash, why should I use Bitcoin, Harapan Coin or other cryptocurrencies?” he questioned.

As an example, Fabian cited “reward points” awarded for purchase of a product or service, which in return could be used to get special discounts or promotions.

“They didn’t give that (Harapan) coin a value to use,” he said.

Instead, he said Harapan Coin’s Initial Coin Offering (ICO), on its official website, only stated how the funds raised would be utilised for the coalition’s election machinery. The initial target for the fundraising is over USD250 million.

Referring to the document which was also commonly referred to as a “white paper”, Fabian noted that it lacked the basic technical details on how the transactions would be carried out.

“Normally any technical presentation will have this technical part incorporated into it.

“For example, I don’t know the ‘wallet’ (used to store bitcoins) is using which language. There is no transparency in term of what language is being used,” he explained, comparing the concept to purchasing a laptop without knowing its operating software.

Fabian said that generally, raising political fundings via bitcoin is a good move, as all transactions are publicly available in a blockchain - a digital, decentralised ledger that keeps a record of all transactions that take place across a peer-to-peer network.

“It could also save money by eliminating transaction fees incurred on conventional methods of transferring money through banks,” he said.

Unlike the conventional system where production and distribution of money is regulated through a central bank, issuance of cryptocurrency is unregulated as it operates on a decentralised blockchain network.

"The issue of anonymity is there because people don't understand how it works. Cryptocurrency is very transparent.

"If tracked, it can even be traced to where it had come from. I don't agree that it should be traded anonymously," he said when asked for comments on concerns that the system could be used as a way to launder money.

Before launching Harapan Coin, Fabian said, the government should first study what cryptocurrency is and its various uses, set a guideline and best practices, and finally enforce regulations on its usage.

In February, Bank Negara Malaysia (BNM) reportedly finalised its guidelines which outlined the reporting obligations for cryptocurrency exchanges.

At the time, news reports also quoted then BNM governor Muhammad Ibrahim who said that the central bank still does not authorise nor endorse cryptocurrency-related activities, and cryptocurrencies are still not recognised as legal tender.

Earlier this week, Federal Territories Minister Khalid Abdul Samad said a paperwork and presentation on the Harapan Coin has been prepared and will soon be presented to the central bank and Prime Minister Dr Mahathir Mohamad.

Khalid, who is the co-founder of the project, said the cryptocurrency technology could be used for payment transaction of licences, payment of summonses and others, to various government bodies.

Former premier Najib Abdul Razak has since demanded for Khalid, who is also Amanah communications director, to reveal who will profit from the planned project.

The Pekan MP’s call was made based on a video on the Harapan Coin website, in which Khalid said that 30 percent of the proceeds from the project will be handed to the developer, followed by 30 percent to Amanah and the remaining 40 percent to the Pakatan Harapan coalition.