Dogecoin Investing Guide For Malaysians: Getting Started

Dogecoin is a cryptocurrency that was introduced in 2013 as a fun alternative to other cryptocurrencies. It was created by software engineers Billy Markus and Jackson Palmer and is based on the popular Doge meme featuring a Shiba Inu dog. While Dogecoin has gained mainstream attention, its future remains uncertain. In this paragraph, we will discuss how to invest in Dogecoin in Malaysia, including the steps to create an account, deposit funds, and purchase Dogecoin, as well as the risks and considerations involved in investing in cryptocurrencies in Malaysia.

Choosing a crypto exchange

Security

The security of your funds is paramount when choosing a crypto exchange. Look for an exchange that offers robust security features such as two-factor authentication (2FA). Google Authenticator, Authy, and Yubikey are examples of commonly used 2FA methods that offer strong security. Additionally, consider whether the exchange provides cold wallet storage options, which allow you to keep your digital assets offline and reduce the risk of cyberattacks.

Reputation and Legitimacy

Conduct thorough research on the exchange's reputation and legitimacy. Check for a physical address, as transparency about their location is often a sign of legitimacy. Examine user reviews and feedback to identify any negative experiences or security issues. Be cautious of exchanges with a history of hacks, scams, or fraudulent activities.

Fees

Crypto exchanges typically charge fees for transactions, and these fees can vary significantly between platforms. Understand the fee structure, including transaction fees, withdrawal fees, and any other associated costs. Compare the fees across different exchanges to make an informed decision.

Country Regulations and Compliance

Different exchanges comply with varying laws and regulations based on their locations and practices. Consider an exchange that adheres to Know Your Customer (KYC) and Anti-Money Laundering (AML) practices, as these help ensure a secure and compliant trading environment. Additionally, check if the exchange allows users from your country, as some platforms may have geographical restrictions.

Cryptocurrency Pairs and Selection

If you're specifically interested in investing in Dogecoin, confirm that the exchange offers Dogecoin trading pairs. Different exchanges offer different cryptocurrency pairs, so ensure the platform you choose aligns with your investment goals. Some exchanges offer a wide range of crypto assets, while others may focus on more popular coins like Bitcoin, Ethereum, and Litecoin.

User Experience and Customer Service

Consider the user-friendliness of the exchange's platform. Look for an exchange with a straightforward and intuitive interface, especially if you're a beginner. Additionally, evaluate the customer service offerings. Check if the exchange provides prompt and responsive support through various channels, such as email, live chat, or phone.

Remember to do your own research and thoroughly evaluate multiple exchanges before making your decision. Choosing a reputable and secure crypto exchange is crucial to protecting your investments and ensuring a positive trading experience.

Payment methods

Before investing in Dogecoin, it is important to understand the payment methods available to you as a Malaysian resident. Here are some options to consider:

Cryptocurrency Exchange Platforms:

To begin investing in Dogecoin, you'll need to create an account with a reputable cryptocurrency exchange that operates in Malaysia. Examples of popular exchanges include Luno, Coinhako, and XBit Asia. These platforms typically allow you to deposit funds using various methods, including bank transfers, credit or debit cards, and even peer-to-peer transfers. It is essential to research the fees, security features, and ease of access offered by each exchange before choosing one.

Credit or Debit Cards:

Using a credit or debit card is a convenient way to purchase Dogecoin instantly. LOBSTR, for example, allows you to buy Dogecoin and other cryptocurrencies with your Visa, MasterCard, or Apple Pay. Some platforms may have minimum purchase requirements, so be sure to review the details before proceeding. Additionally, always ensure that your chosen platform handles your payment information securely and in compliance with relevant regulations.

Bank Transfers:

Bank transfers are a common method for depositing funds into your chosen cryptocurrency exchange platform. This option is often available for both local and international bank accounts. However, it is important to note that some platforms may only accept bank transfers from specific countries or regions. Always review the platform's terms and conditions to ensure that your bank transfers will be accepted.

Peer-to-Peer Transactions:

Some platforms, like LocalBitcoins and Coinexy, facilitate peer-to-peer transactions, allowing you to buy and sell Dogecoin directly with other users. These transactions usually involve various payment methods, with cash being the most popular. However, it is crucial to exercise caution and evaluate the trustworthiness and reputation of the other party before agreeing to any trades.

Cryptocurrency ATMs:

Another option for purchasing Dogecoin is through cryptocurrency ATMs, such as the Pinkexc ATM in Ipoh, Malaysia. These ATMs allow you to insert cash and receive Dogecoin directly into your wallet, offering both privacy and instant access to your coins. However, the availability of such ATMs may be limited, so be sure to check for locations near you.

When investing in Dogecoin or any other cryptocurrency, it is essential to stay informed about the latest regulations and guidelines in Malaysia. Additionally, always remember to do your own research, understand the risks involved, and only invest what you can afford to lose.

Volatility and risk

Dogecoin is a highly volatile cryptocurrency. Volatility refers to the rate at which the price of Dogecoin or any other equity instrument increases or decreases over a given period. It is calculated by computing the standard deviation of annualised returns over a given period, indicating the potential range of price changes. Dogecoin's volatility is 7.31, making it 11.79 times more volatile than the NYSE Composite. 64 percent of all equities and portfolios are less risky than Dogecoin.

Dogecoin's beta coefficient, which is 1.71, measures the volatility of the crypto coin compared to the systematic risk of the entire market. A beta of 1.71 indicates that Dogecoin has the potential to add significant risk to an existing portfolio. Dogecoin is displaying above-average volatility and investors should carefully scrutinise it to ensure their market timing strategies align with expectations.

Dogecoin's volatility can be beneficial to investors. Downward market volatility can be advantageous for long-term investors, as they can purchase more Dogecoin at lower prices, improving their portfolio's performance when the markets normalise. Similarly, when Dogecoin's price rises, investors can sell and invest in other coins. Investing in volatile markets can help investors in evolving crypto projects, such as Dogecoin, generate better long-term returns.

Dogecoin exhibits lower volatility than Bitcoin, with a 30% annualised 30-day realised volatility compared to Bitcoin's 35%. Historically, Dogecoin has been associated with higher volatility, which has deterred risk-averse investors. However, this shift in relative price stability may be due to a lack of investor interest in alternative cryptocurrencies, rather than market maturity.

The Compass Crypto Volatility Index Dogecoin – 20% is a set of indices that provide exposure to cryptocurrencies while controlling the volatility of the strategy. It offers investors a risk-controlled approach to investing in the highly volatile crypto asset class.

Crypto wallets

Hot wallets are digital tools that are usually connected to the internet through a phone or desktop computer. They are more susceptible to hacks but offer greater convenience and are ideal for active traders. Examples of hot wallets include the Coinbase Wallet, MetaMask, and Trust Wallet.

Cold wallets, on the other hand, store your digital keys offline, either on a hardware device or a sheet of paper. They are harder to hack but are more prone to loss or destruction. Examples of cold wallets include Ledger, Ellipal Titan, and SafePal.

When choosing a crypto wallet, it is important to consider factors such as security, functionality, cost, and the types of cryptocurrencies supported. Additionally, one should assess their trading frequency, the types of crypto they want to trade, and their desired level of functionality.

Dogecoin's value

Dogecoin is a peer-to-peer cryptocurrency that was created in 2013 by software programmers Billy Markus and Jackson Palmer. It is based on blockchain technology and was forked from Litecoin, inheriting many of the same features such as the hashing algorithm. The only difference is in the branding and large inflationary supply. Dogecoin was introduced as a "joke currency" and quickly developed its own online community, reaching a capitalization of US$60 million in January 2014.

The value of Dogecoin has fluctuated since its creation. Between May 2015 and May 2020, the average price of Dogecoin was close to a fifth of a cent. Its popularity grew alongside a surge in retail investment during the Covid-19 pandemic, as well as endorsements from well-known entrepreneurs like Elon Musk. In 2021, Musk's tweets about Dogecoin sparked a furious DOGE rally that culminated in his appearance on Saturday Night Live. After the SNL appearance, however, DOGE crashed despite Musk's promises to increase its price.

Dogecoin can be purchased on exchanges such as LOBSTR, CoinSwitch Kuber, Gate.io, WhiteBIT, and BVOX.

Frequently asked questions