Country Heights gets nod for crypto issuance

The ‘Horse Currency’ is closer to being a stablecoin, but its categorisation remains unknown

By NG MIN SHEN / Graphic By TMR

COUNTRY Heights Holdings Bhd (CHHB) has obtained the go-ahead from its shareholders for an initial coin offering (ICO) to issue its own asset-backed cryptocurrency, dubbed “Horse Currency”.

CHHB group executive chairman Tan Sri Lee Kim Yew said the property developer’s shareholders voted “99.99%” in support of the initiative at its EGM in Kuala Lumpur yesterday.

“With this approval from our shareholders, we will immediately appoint a technology partner and legal advisors for the initiative.

“We are also setting up a task force to oversee the ICO and all related technology and infrastructure,” Lee told the press after the EGM.

The task force will handle the acquisition and investment of the blockchain technology for ICO purposes, as well as set up the infrastructure of the technology throughout CHHB’s business portfolio, including its resorts and hospitality, automotive, healthcare and property segments.

Lee said the task force, which will comprise 20 members, will also continue to engage with the relevant authorities and regulators, including the Ministry of Finance, Bank Negara Malaysia, Securities Commission Malaysia (SC) and Bursa Malaysia Bhd, as well as with the Malaysia Blockchain Association (MBA).

The SC said recently that it will implement a regulatory framework to regulate digital asset exchanges and ICOs, with regulations expected to take effect in the first quarter of 2019.

“We already spoke to the SC last month and now we are preparing for the ICO. Whether our currency will be classified as a security token offering, utility token or ‘stablecoin’, we will wait for the SC’s regulations, then we will adjust where necessary,” Lee stated.

He said the “Horse Currency” is closer to being a stablecoin — a price-stable cryptocurrency — but its categorisation remains unknown pending the release of the SC’s regulations.

“We are already in talks with local and foreign advisors, while the advisor with our task force is the MBA,” Lee added.

CHHB’s appointed task force will also look into setting up a cryptocurrency wallet, while studying the possibility of creating a CHHB e-wallet or collaborating with other e-wallet players.

The developer is planning to engage investment bankers for its ICO, which Lee said will be open to international investors, as well as locals.

CHHB intends to issue one billion of its horse currency, backed by RM2 billion worth of company assets, with an initial 300 million of horse currencies to be open for circulation to the public.

Notably, the group’s total assets as at end-2017 stood at RM1.27 billion, while total equity attributable to shareholders amounted to RM793.45 million, as per its 2017 annual report.

Yet, Lee said the developer “definitely has RM2 billion in assets”, as many of its investments and properties have not been re-valued for years.

The “Horse Currency” will be mainly used as a utility token, a reward token and royalty programme with the businesses, products and services under the company’s new business strategies.

Lee said the money raised from the ICO will go towards its plan to have RM1 billion worth of “war chest funds”, to support its re-strategisation into new business areas.

Shares of CHHB closed three sen or 2.31% higher at RM1.33 yesterday, valuing the group at RM363.83 million. The stock saw 32,200 units traded.