A Beginner's Guide: Investing Bitcoin In Malaysia

Bitcoin has become an increasingly popular investment option in Malaysia, despite its legal grey area. While digital currencies are not recognised as legal tender, they are also not illegal, and the Malaysian government has stated that cryptocurrencies will not be banned. As a result, many platforms have emerged to help Malaysians buy and sell Bitcoin, such as Luno, SINEGY, Tokenize, and Binance. However, it is important for investors to be cautious, as the cryptocurrency market is highly volatile and unregulated exchanges have been targets of theft and fraud.

Choosing a platform: Luno, SINEGY, Tokenize, and more

When it comes to choosing a platform to invest in Bitcoin in Malaysia, there are a few options to consider. Luno, SINEGY, and Tokenize are three popular choices, each with its own unique features and advantages.

Luno is a well-established platform, having been in operation since 2013. It offers an easy-to-use interface and supports multiple languages, making it a convenient choice for users in Malaysia. Luno allows users to buy and sell Bitcoin, Ethereum, XRP, and Litecoin. One of its standout features is the Luno Wallet, which provides a secure way to store cryptocurrencies. Luno also supports various payment methods, including bank transfers and credit card payments. The platform has a strong focus on security, with sophisticated Bitcoin security systems in place. Additionally, Luno has achieved significant transaction volumes, with RM4.2 billion worth of transactions as of June 2023.

SINEGY, a Malaysian brand founded in 2017, offers a more limited selection of cryptocurrencies, currently only providing Bitcoin and Ethereum options. However, it is a good choice for beginners, with no minimum deposit required and a 0.25% rebate for market makers. SINEGY also boasts low bitcoin withdrawal fees of 0.05%.

Tokenize, founded by a Malaysian, is based in Singapore and offers a wider range of crypto options compared to SINEGY. It provides a mobile app and a referral and points system. Tokenize has a minimum deposit amount of RM100 and employs various security measures, including IP whitelisting, 2-Factor authentication, and a hybrid wallet mechanism.

When deciding between these platforms, it's important to consider factors such as the number of currency options, fees, security features, and user interface. Luno stands out for its security and ease of use, while Tokenize offers a broader range of cryptocurrencies. SINEGY, on the other hand, is ideal for beginners with its low fees and no minimum deposit requirement. It's worth noting that these three platforms are the only regulated crypto platforms in Malaysia, providing an extra layer of security for investors.

Payment methods: bank transfer, credit card, or cash

There are several ways to buy Bitcoin in Malaysia, with bank transfers, credit cards, and cash being among the most popular options.

Bank Transfer

A bank transfer is a secure option for buying Bitcoin, especially for larger amounts. You can use this method with a crypto exchange platform such as Changelly, which accepts Malaysian Ringgit (MYR) and offers low trading fees and high security. Keep in mind that bank transfers may take longer, and fees may vary depending on the platform and bank.

Credit Card

Using a credit or debit card is a fast and secure way to buy Bitcoin. Changelly, for example, accepts Visa and Mastercard credit cards issued in your local currency. You can also use a third-party e-wallet service like Apple Pay or Google Pay to add funds to your chosen crypto exchange.

Cash

If you prefer to use cash, there are several options available:

• An exchange that supports cash payments: You can quickly deposit cash in MYR into an exchange and acquire BTC within minutes.
• Local Bitcoin ATM: You can search for "Bitcoin ATMs near me" to find machines that accept cash deposits.
• Local meetups or trading groups: You can connect with other buyers and sellers through social networks like Facebook or Telegram and conduct transactions directly, which may offer better pricing due to the absence of exchange trading fees. However, this option carries more risk, as you are operating outside of regulated platforms.
• Peer-to-peer projects: Online platforms like Paxful allow users to trade Bitcoin directly with each other and choose their preferred payment methods, including cash deposits through a bank.

It is important to note that the legality of buying, selling, and using Bitcoin in Malaysia is not entirely clear, so individuals should understand the associated risks and ensure they comply with SCM and Bank Negara regulations.

Safety and security: 2FA, staff requirements, and deep freeze storage

When it comes to investing in Bitcoin in Malaysia, safety and security are paramount. Here are some key considerations for protecting your cryptocurrency investments:

Two-Factor Authentication (2FA)

Two-factor authentication (2FA) is a critical tool for securing your Bitcoin investments. 2FA strengthens access security by requiring two methods of verification to confirm your identity. Typically, this involves something you know, such as a username and password, and something you have, like a smartphone app, to approve authentication requests. By utilising 2FA, you protect your logins from attackers attempting to exploit weak or stolen credentials. Additionally, 2FA safeguards against phishing attempts, social engineering, and password brute-force attacks.

Staff Requirements

In Malaysia, the Securities Commission Malaysia (SCM) is the primary regulator for digital asset service providers. Companies intending to operate in the country must register with the SCM and comply with specific guidelines and regulations. One crucial aspect is staff training for employees working in relevant areas. This training equips staff with the knowledge and skills necessary to identify and mitigate security risks effectively.

Deep Freeze Storage

While cold storage options like Ledger or Trezor offer offline storage of your Bitcoin on an encrypted USB stick, some investors opt for "deep freeze" storage for added security. Deep freeze storage involves diversifying your Bitcoin storage across multiple locations and formats. This could include safety deposit boxes, exchanges, lending platforms, hot wallets, and more. By adopting deep freeze storage, you reduce the risk of losing your crypto assets in the event of a hack or technical failure at any single location.

By implementing these safety and security measures, you can enhance the protection of your Bitcoin investments in Malaysia, safeguarding your digital assets from potential threats.

Wallets: Luno, multi-signature, and hybrid

When investing in Bitcoin in Malaysia, it is important to consider the different types of wallets available to store your cryptocurrency securely. Here is an overview of three types of wallets: Luno, multi-signature, and hybrid.

Luno Wallet

Luno is a popular crypto exchange and wallet provider that has been in operation since 2013. It offers a free Luno Wallet for web, iOS, and Android users, allowing them to buy, store, and send Bitcoin, Ethereum, XRP, and Litecoin securely. Luno has over 5 million global customers and is known for its user-friendly platform, supporting various local payment methods and languages. Luno also prioritises security, employing sophisticated Bitcoin security systems and storing 95% of crypto in "deep freeze" multi-signature wallets with multiple layers of encryption.

Multi-Signature Wallets

Multi-signature wallets, or multi-sig wallets, are a type of cryptocurrency wallet that requires multiple signatures (or approvals) for transactions. This added security measure helps protect your digital assets. Both Binance and Huobi offer multi-signature wallets. Binance provides two-factor authentication and cold storage options, while Huobi uses dedicated multi-signature cold wallets with 24/7 security monitoring and a 20,000 BTC Security Reserve Fund for additional asset protection.

Hybrid Wallet

Tokenize, a Singaporean platform, employs a hybrid wallet mechanism with a multi-signature strategy as one of its security measures. This combination of a hot wallet (connected to the internet) and a cold wallet (offline) offers convenience and security. Tokenize also offers other security features like IP whitelisting and two-factor authentication.

Buying and selling: limits, fees, and verification

When it comes to buying and selling Bitcoin in Malaysia, there are a few things to keep in mind in terms of limits, fees, and verification.

Limits

Firstly, it is important to note that there are no transaction limits for bank transfers, besides your verification level limits. FPX instant transfers are limited to RM 100,000 per deposit, and Touch 'n Go eWallet deposits have monthly transaction limits of up to RM 5,000 for Pro users and up to RM 20,000 for Premium users.

When it comes to withdrawals, there are no limits to the amount of cryptocurrency you can receive. However, Luno may limit the amount of cryptocurrency you can send during 24-hour and 30-day rolling periods as an anti-financial crime measure. These limits are tailored and dynamic, based on your identity verification level.

Fees

Deposits and withdrawals are free for amounts of RM 100.00 and above. For amounts below RM 100.00, there is a fee of RM 1.00. This applies to FPX Instant Transfers and Touch 'n Go eWallet transactions as well.

When buying or selling crypto from the Wallets screen, the following minimum and maximum limits apply per transaction:

• RM 1.00 - RM 400,000
• ADA 0.10 - ADA 100,000
• ATOM 0.005 - ATOM 4,000
• AVAX 0.05 - AVAX 5,000
• BCH 0.001 - BCH 40.00
• BTC 0.000025 - BTC 5.00
• DOT 0.006 - DOT 5,000
• LINK 0.05 - LINK 1,000
• MATIC 1.00 - MATIC 75,000
• SOL 0.05 - SOL 1,000
• UNI 0.10 - UNI 2,000
• XRP 0.10 - XRP 80,000

The fee you pay when buying or selling crypto on the Luno Exchange depends on your total 30-day trading volume and the type of order you place. A taker order, which trades at the market price, will have a different fee than a maker order, which trades at a limited price.

Additionally, Luno charges a dynamic fee for crypto sends, except for XRP, which has a fixed 0.03% send fee. The dynamic fee is calculated based on the blockchain fee, which is beyond Luno's control, and Luno's operational costs. During periods of high demand, the fee for sending crypto increases.

Verification

To find out your verification level, go to your Profile and select Settings. Under Verification, you will see either "Not Verified" or "Fully Verified".

Frequently asked questions