In a market flooded with cryptocurrencies and digital assets, the Islamic Coin token sale has garnered both attention and skepticism over the past week. Marketed as a digital currency adhering to Shariah principles and ethical values, the sale has raised concerns among potential investors.

The creators of Islamic Coin have consistently highlighted their association with leaders from the royal families of Abu Dhabi and Dubai, along with experts in Islamic and traditional finance from Wall Street and the City of London. However, it is essential to note that having advisors with royal connections does not necessarily imply their direct support or legal responsibility within the company, as none of these royal family members are actively involved in the company’s operations or executive board.

Islamic Coin is portrayed as the native currency of HAQQ, a community-run network under the Swiss-based non-profit Haqq Association. The management has repeatedly emphasized its compliance with Shariah law and its commitment to ethical finance. They claim that 10% of each issuance will be directed towards the Evergreen DAO, a non-profit virtual foundation dedicated to investing in Islam-related ventures and charities.

However, one significant concern is the absence of a clear base of operations for Islamic Coin, as indicated on its website. There is no official registration for Islamic Coin or the Haqq Network in Switzerland or the United Arab Emirates. Republic’s website suggests that the token sale is conducted by Bored Gen, based in Dubai’s DMCC. Yet, it is emphasized that this offering does not grant ownership or partnership interest in Bored Gen DMCC or its affiliates.

A closer look at Bored Gen DMCC reveals that it is registered with an office address in Dubai, UAE, but the provided contact email leads to someone associated with ArbiLegal.com, a team of lawyers specializing in FinTech and cutting-edge technologies like AI and blockchain. No clear information regarding Bored Gen DMCC’s activities is available.

Furthermore, Republic explicitly states that this token sale is exclusively for non-US investors, with US investors required to be accredited. This restriction is in line with Dubai’s virtual asset regulatory authority, which fined the OPNX token exchange platform for marketing its operations in the UAE without proper licensing.

One critical question arises amidst these concerns: Why is Islamic Coin, backed by the Haqq Association, seeking to raise funds through a token sale at a minimum value of 0.3 cents, given their reported $193 million in funds raised through private rounds?

In their press releases, Haqq initially claimed to have raised $200 million in a private sale in August 2022, without disclosing the high-net-worth individuals (HNWI) investors involved. Subsequently, in July of the following year, they announced another $200 million raised from ABO Capital, a subsidiary of the multifamily Blue Ocean Group. However, the total reported funds now stand at only $193 million. This discrepancy raises questions about the handling of funds.

Upon closer examination, the partnership with ABO Capital reveals that it provides access to a maximum of $200 million, as needed, implying that the full $400 million was never raised. With a substantial sum of $193 million in their possession, some investors are left wondering why Islamic Coin is pursuing a public token sale at such a low price.

Republic, as an intermediary, also discloses its vested interest in the Islamic Coin token sale. They caution investors about the speculative nature of deals involving cryptocurrencies and digital assets, advising investor sophistication and enhanced independent reviews. They acknowledge the possibility of ISLM Tokens trading at lower prices on public exchanges compared to the sale price.

Moreover, Republic mentions that this issuer operates from a foreign jurisdiction, implying that some common laws may not apply or be enforceable, adding an element of uncertainty. Additionally, they highlight that the company is new and has not generated revenue or established a significant operating history.

It is worth noting that affiliates of OpenDeal Broker LLC, the intermediary facilitating the token sale, have financial interests in the offering. OpenDeal Broker LLC is compensated through cash commissions and tokens by BoredGen DMCC, which further underlines the potential for bias in promoting the sale.

In conclusion, investors are urged to exercise caution when considering participation in the Islamic Coin token sale. While it claims to adhere to Shariah principles and ethical values, the lack of transparency regarding its operations, the discrepancy in reported funds raised, and the involvement of affiliated parties with vested interests raise valid concerns. As with any investment, thorough due diligence and careful consideration of the risks are essential.