Beware of geeks bearing tech, Putrajaya warned as pro-Zionist crypto boss threatens to quit Malaysia

An opposition politician has warned Putrajaya against being lured by promises of technology investment after a US-based crypto tycoon known for his pro-Israel stance appeared to threaten the Malaysian government that he would take a so-called "digital community" he founded two years ago out of Malaysia.

It comes after immigration officers descended on Network School, a co-living community that attracts hundreds of digital nomads and entrepreneurs from around the world, which was embroiled in controversy following claims that it has allowed Israeli nationals with dual American citizenship to set up base there.

Lawyer and Pejuang leader Rafique Rashid said the Network School, part of tech and crypto boss Balaji Srinivasan's vision of creating a "Network State" that he once compared to "tech Zionism", should not be viewed merely as an immigration or investment issue, but as part of a broader ideology to reshape the concept of sovereignty.

"The goal is ultimately to demand sovereignty for a 'digital nation' here. This is no ordinary investment, it is a tactic to establish a 'nation within a nation'," said Rafique.

"Why are we so easily taken in by foreign money? Yes, investment is important, but the dignity and security of our borders are far more important."

Rafique also hit out at Srinivasan for suggesting that the publicity surrounding the Network School is likely to cause the cancellation of some RM500 million in investment he had planned.

"This foreign investor is now behaving arrogantly. When police investigate, he threatens to suspend the investment. He wants the government to bow to his terms. Since when can a guest bully his host?" he asked.

Reacting to checks from immigration authorities this week, Balaji dismissed claims of Israeli nationals being present in his establishment as "sensational accusations", and singled out a pro-Palestine social media account for spreading a "fake story".

"If you don’t want our investment, or those of our colleagues at billion dollar funds and trillion dollar companies, we will of course respect your wishes, and reallocate our capital to other countries instead," he wrote, while announcing that all future plans were suspended "until we get sufficient assurance that such issues won’t recur". 

Rafique reminded authorities that Srinivasan's Network School reflected a model in which technology entrepreneurs seek to establish parallel societies operating beyond traditional nation states.

"The methods have changed. Colonialism today does not necessarily come through military force, but through technology, digital platforms and cryptocurrency," he said.

Rafique also reminded authorities how, at the turn of the 20th century, Theodor Herzl, who founded the Zionist movement, had offered Ottoman ruler Sultan Hamid II to pay off the Ottoman Empire's debt in exchange for an agreement to establish a Jewish settlement in Palestine. 

"Sultan Hamid II replied, 'I will not sell even an inch of this land.'

"The government must firmly reject this threat/offer. It is not enough to just make a statement without any action," Rafique added.

Network School was established almost two years ago, and has evolved from a temporary set-up to a permanent residency for hundreds of people from around the world, who pay a monthly fee of just over RM6,000 for accommodation and other facilities.

The centre also hosts talks featuring many pro-Israel entrepreneurs such as Ethereum co-founder Vitalik Buterin and Brian Armstrong, the CEO of cryptocurrency firm Coinbase, which has made heavy investments in Israel.

Other speakers with political and business links to Israel include Ben Horowitz, Bryan Johnson and Anatoly Yakovenko, and more than a dozen others, according to its website.

Srinivasan reportedly approached Malaysian politicians to support his project, including Digital Minister Gobind Singh Deo.

The DAP national chairman visited Network School in April, where he posed alongside Srinivasan.

"What I saw reaffirmed Malaysia’s position as a rising destination for global tech talent," he wrote on X, only to later take down the post following a barrage of criticism.

In what could raise further questions, Bloomberg reported that Srinivasan had pitched a prototype of Malaysia’s visa application platform, with a view to approving fast-track visas for Network School residents, allowing them longer stays.