Looking for information about bitcoin in Malaysia? I’m glad people are showing more interest in this, but it’s risky to dive in without sufficient information. From my experience admin-ing one of the Bitcoin Malaysia FB pages (here; join for latest news and updates), seems like many people like to promote unsafe bitcoin investment opportunities.
So here’s a FAQ about everything you should know about Bitcoin in Malaysia, as a newbie. This is kept fairly jargon free.
What is bitcoin?
It’s a decentralised cryptocurrency and digital currency. Decentralised = not issued or regulated by any governments. Your RM was issued by Malaysian government right? So decentralised means that bitcoin (and most other cryptocurrencies) is not under any country. The easiest way to describe bitcoin is its an ‘internet currency’. Imagine the internet as a country and bitcoins can be sent anywhere without geographical borders.
Because it’s not bound by a country, you can effectively use it anywhere globally (online and offline), as long as you have access to it.
Oh, bitcoin is not anonymous btw. If you heard that, I’ll tell you now that it’s a myth. A criminal who uses bitcoin is a stupid criminal. Transactions are fairly easy to trace via Blockchain.info, but having said that there are ways to hide the trails if one is clever. If I’m a criminal I’d just stick to paper money tbh, that’s way more anonymous.
Decentralised? Is it legal/Is it considered money?
The legality of bitcoin can be debated. In Malaysia, it’s not considered as money at all (BNM don’t consider it legal tender). In some countries, the government wants to ban bitcoin or actively discourage it (Venezuala, for example, released propaganda against bitcoin). This Legality of Bitcoin by Country page has a good overview (though some not updated).
Is Bitcoin halal?
Short answer: yes if you understand the risks associated. I wrote about this extensively in this and this articles – both of them are NOT opinion pieces. They are the result of hours of research; I read scholarly articles and interviewed an Islamic Finance Professor from INCEIF.
If you don’t know how bitcoin works, then it’s considered haram-ish because that’s just gambling.
What can I use Bitcoin for?
- Keep as investment (most popular among Malaysians it seems)
- Use it to pay products and services (see my guide on places that accept bitcoins in Malaysia)
- Use it to accept payments for your shop (I’ll cover this in a separate section below)
- Use it as a method to send money, like an international money transfer of sorts, and you send it via the internet
- Some people use it to donate, like when Visa and PayPal refused to become payment method for Wikileaks donations, they asked people to give bitcoins instead
How do I get bitcoin in Malaysia?
This is probably the most important question for some of you. There are two main ways: mining and buying.
How can I mine bitcoins in Malaysia?
Let me stop you there. Yes, you can mine bitcoins in Malaysia. Will you get fast profit from it? Most definitely not. Sorry. Better you hear it from me first.
Why? Because you need (1) expensive equipment to start and (2) you can’t compete with Chinese miners.
ONE bitcoin mining machine costs thousands of ringgit, and you’ll have to pay for electricity on top of that. If you mine bitcoins yourself, you’ll get your modal back in a few years (by which time new, better bitcoin mining equipment already come out).
Chinese miners have dedicated factories filled with thousands of these equipment. AND they have cheap (or free) electricity. See the video below, its an eye-opener.
My advice if you want to mine bitcoins? Do it as a hobby, and only as a hobby. It’s not recommended to do at home – it’s hot and noisy.
How about those Bitcoin cloud mining things?
I hear this a lot. So cloud mining is bitcoin mining factories that allow you to buy ‘shares’ or whatever in return for bitcoin profits. The idea is that someone else will do the actual mining for you, while you help them with the upkeep (usually to help pay electric bill). It sounds good on paper.
The problem is, most cloud mining companies are thinly veiled Ponzi/pyramid schemes instead (read my article on how to spot investment scams here). The profit you get is referral profit, instead of actual bitcoin mining profit. It makes money only for the top few people, while the rest will lose their investments.
For this reason, I actively discourage you to enter any cloud mining opportunities. Bitkingdom, HashOcean and other names included in this BadBitcoin BadList should be avoided. If you have money in there… take it out, while you still can.
Edit: There are legit cloud mining companies. One of them is Genesis Mining (note: not an endorsement). Reviews say that the profit rate is too small though, but I have not personally tried myself. Dividend Magic is trying this out, go read his experience here.
OK, I understand about bitcoin self-mining and the slow profit, but I still want to do it
The information in this section has been kindly provided by captminer, who have been mining bitcoins in Malaysia since 2013.
Where to buy mining equipment. You can buy mining equipment from Bitmain. This website is recommended as they provide warranty, although claiming said warranty can take a long time. You can also buy locally used mining equipment from Malaysians – this can be a cheaper option, but of course no warranty. There’s a healthy listing of mining equipment in the Bitcoin Malaysia #1 (Open) page.
Who mines bitcoins in Malaysia. The group is kind of scattered and low-profile, so the best bet is to join some bitcoin groups in Malaysia and ask. There’s no restrictions or clubs or permissions that you need to get to start mining bitcoins in Malaysia. But do be aware that the mining equipment will be noisy, heat up, consume a lot of power, comes with high setup fee, maintenance and time cost. To quote Capt, ‘it’s not as easy as one may think’.
What is the typical ROI (return on investment). It USED to be 3 months ROI. Now Capt said it’s closer to 6 months, BUT this does not take into account maintenance like electricity cost and rigging/setup. Miners will also need to know that there are other variables that will affect the potential profit, such as downtime, miner management, bitcoin prices, what to do once upon successful mining, equipment breakdown, spare parts, rental for dedicated space, and more.
Taking all these into consideration, its best to do this as a hobby – you have to be knowledgeable and passionate about equipment rigging and stuff. The money is a bonus.
Someone told me about Bitcoin faucets…
Bitcoin faucets give you ridiculously small amounts of bitcoins that you shouldn’t even bother. Once I spent days in tens of bitcoin faucets and earned… USD0.20. Some also give extras if you get lots of referrals, but in general not that profitable.
Your time is more valuable than that 🙂
Bitcoin faucets are easy to find. Just google them and many should pop up.
So if I want Bitcoins, my only option is to buy them?
Well you can also ask people to donate to you, or accept it as payment for your products/services, or work for it (google ‘work for bitcoin’). But the fastest is to buy them. There are a few reputable exchanges in Malaysia – see next section. The usual process to buy bitcoin is:
- Select a bitcoin service provider with an exchange. Some bitcoin service providers are exchanges, but many offer beyond bitcoin buy/sell.
- Perform verification. You need to send your ID and wait until you get verified. This may take days. I don’t know which one is the fastest.
- Once you’re verified, transfer your money to the service provider. Usually by bank transfer, sometimes PayPal. This can also take days.
- Buy bitcoin. After your money arrived to the bitcoin service provider, you can then buy bitcoin.
- (If LocalBitcoin, Remitano or Coinexy) Choose a seller (pick one with good track record) and transfer to their bank account. Make sure to use Instant Transfer. Most seller will not release the bitcoin to you without the money in their bank account.
As a rule of thumb, the more relaxed the rule (buy with gift card, no verification), the higher the bitcoin price. There are exceptions, but this is usually the case. It’s also almost impossible to buy below market rate, unless you manage to negotiate a bulk deal.
Where can I buy bitcoin in Malaysia?
- Buying with MYR (bank transfer to sellers) – Localbitcoin. Make sure to pick a seller with good track record. (note: referral link)
- Buying with MYR (bank transfer to sellers) – Remitano. Make sure to pick a seller with good track record. (note: referral link)
- Buying with MYR (bank transfer to sellers) – Coinexy. Make sure to pick a seller with good track record. (note: referral link)
- Buying with MYR (bank transfer) – Luno (note: referral link; Get RM5 if buy/sell more than RM250) – formerly Bitx
- Buying with MYR (bank transfer) – Coinhako (note: referral link; Get RM15 if buy/sell more than RM300)
- Buying with MYR (bank transfer) – XbitAsia. I’ve not used this option.
- Buying with MYR (via bitcoin ATM) – Pinkexc Malaysia in Ipoh
- Buying with Paypal – Wirex (note: referral link; get 25% off plastic cards). Get a virtual card (the first one is free), verify account, then transfer money from Paypal into the card to buy bitcoin
- Buying with debit/credit card – Cex.io (note: referral link)
To buy other types of cryptocurrency, please see the list in FAQ: How to Invest in Cryptocurrencies in Malaysia (Aside from Bitcoin)
What should I know before I buy?
You should know:
- Bitcoin is considered a high-risk investment. The value rises and falls randomly. Once I’ve bought and immediately lost 15% of its value the next day. There are good days when Bitcoin ‘mooned’ (slang for sudden increase in price), but there are also bad days when suddenly prices fall and took a while to recover. Compare it to gold, if you will.
- Bitcoin transactions are not reversible. When you send bitcoin, you can’t reverse the transaction.
- Digital security knowledge is a must. There are plenty of scammers (read my guide on types of Bitcoin scams). You need to know how to set up 2 factor authentication and set strong passwords (ideally use a password manager).
- When to be rude. Yup, politeness does nothing when it comes to money. A high level of skepticism is needed. ‘Hi sis nk btc x sy jual murah…’ ‘Tak’. ‘Jom join [random bitcoin cloud mining company], boleh kaya same same huhu’ ‘No thanks’.
- How to store your bitcoins. There are two main ways (simplified version). One is via hardware bitcoin wallets, which are USB-type devices that you can store bitcoins and take it off the internet. Second is via reputable bitcoin services. I suggest you get 2-3 companies and spread your bitcoins around, you never know if they will suddenly go bust (this has happened before; it’s called the Mt Gox incident). I particularly like Wirex for this: 2FA, multi-sig wallets, and email confirmations for every transfer. (Disclaimer: I provide work for Wirex, but use it for personal use, too)
- Common slangs. I mentioned ‘moon’, which refers to sudden increase in price (also; ‘to the moon’ and ‘rocket’). Goxxed refers to reputable-appearing services that may not be good after all. Hodl is to hold and keep bitcoins for long-term, even when a crisis happens (apparently someone misspelled it and it stuck lol).
- How people usually scam in Malaysia. Usually they contact/get contacted by someone who offers to sell bitcoins below market price (see global average price here)
- There are fees. Buying and sending bitcoin will usually incur a small fee. Specific bitcoin service providers have their own fees to use the service as well. Like how you pay bank fees to use bank facilities.
- You don’t have to buy one whole bitcoin. One bitcoin has 10,000,000 satoshis. One satoshi is 0.00000001 bitcoin. It’s not common to buy less than 0.01 bitcoin though.
- Use escrow services when buying/selling to other people (if not using bitcoin exchange). Escrow means there are protections in place for buyers and sellers. This way, you reduce chance of seller mysteriously disappearing after you bank in the money.
- Bitcoin Cash (BCH) is different from bitcoin (BTC). They share the same ancestry, but Bitcoin Cash is treated as another cryptocurrency.
There are other things to know, but the above covers pretty basic must-know information if you’re a bitcoin newbie.
When is a good time to buy?
Sorry my crystal ball haven’t arrive yet 🙂
I’m big on ‘dollar-cost-averaging’ method. Ie you buy little by little over a period of time. This way you’re less susceptible to effects of price swings.
Will I make money from bitcoin?
If the value goes up, yes. If the value goes down, no. Bitcoin is not a get-rich-quick scheme.
Bitcoin sells for different prices in different countries. In some countries, the value is higher than the global average price (see BitcoinAverage), so some people make money by buying in X country and selling in Y country. This is called arbitrage.
Which bitcoin wallets should I use?
The answer depends on what you want to use the bitcoin for. It’s common to open multiple bitcoin accounts and have multiple wallets. In fact, it’s recommended to do so – in case you lose access to one wallet, at least you don’t lose all your bitcoins. Some quick pointers:
- If you buy bitcoin, your first wallet is probably with the bitcoin exchange. In Malaysian context, most probably the ones that accept your MYR for the payment. Leave it there or transfer it out, your call.
- If you earn or collect bitcoin in other ways, you can use any wallet as receiving address, even the ones without Malaysian presence. Example includes Blockchain, Coinbase, etc. Check r/bitcoin and bitcointalk for recommendations. Some are known for good customer service, some highlight their security features, some focus on simple UI, some allows trading… this list is not exhaustive. I suffered from analysis paralysis too in the beginning. Then I realise that personally, I value being able to cash out bitcoin to RM quickly, so I don’t use companies that are not Malaysia-friendly.
- If you want to sell or spend bitcoin, use bitcoin wallet from bitcoin service providers that allow you to do so. Like Luno, Localbitcoin (sell) and Wirex (spend).
- If you want to keep bitcoin for long-term and just forget about it for now, keep bitcoin in hardware wallet, or download secure mobile wallets like Mycelium, Copay or Jaxx (write down your private keys in case you lose your phone) or print out as bitcoin paper wallet and keep it securely. If you write or print anything out, laminate the shit out of it and keep it out of sunlight, fire sources etc. Keep your private keys safe, don’t post it online.
- If you want to make regular bitcoin transactions, pick a wallet which offers low fees or allows you to set own blockchain fee rates. There are many options – check here and here. Pick one or two, and make your bitcoin transactions from there to save some satoshis.
Aside from bitcoin, what other cryptocurrencies can I hold?
Please read new article: FAQ: How to Invest in Cryptocurrencies in Malaysia (Aside from Bitcoin)
How do I accept bitcoins for my business?
Follow the steps below. Also, here are some shops in Malaysia that accept bitcoin as payment.
- Print/include Bitcoin Accepted Here logo at your shop and announce on social media. Contact me and I can help to get your shop listed on guides, websites, etc.
- Have a secure bitcoin wallet. There are plenty, but you should look for something that has multiple layers of security – with multi-sig technology, can enable 2FA, email confirmation, new address generation etc. Get Wirex, it’s easiest for Malaysia.
- From your bitcoin wallet, generate (a) a bitcoin address and/or (b) a QR code. Customers who want to pay with bitcoin can then send bitcoin to these addresses, and it should arrive in less than 30 mins. All transactions are publicly-viewable on blockchain.info, so there are no way to make false transactions. Your wallet should also be able to notify you when you receive the bitcoins.
- For security, ensure to change your address every so often. Because transactions are transparent, there may (or may not be) people who scan the blockchain to look at ‘rich’ wallets to target.
Once you have the bitcoins, you can let it stay in your bitcoin wallet (note the volatility) or exchange it back to fiat immediately. How to do this? A few ways:
- Sell on localbitcoins or Remitano. Not recommended for newbies, unless you’re naturally skeptical 🙂 Lots of scammers who claim to have sent money but did not and urge you to release bitcoins anyway. Plus it could take hours, or days. If you still want to do it, Ctrl+F ‘localbitcoin’ in the comments section for tips.
- Sell to strangers/people. Not recommended, but if you want to do this, do it in public space, preferably near a police station or something. People have been robbed before during meetup.
- Sell on exchanges. Sell at Luno (note: referral link; Get RM5 if buy/sell more than 0.1 btc) or other bitcoin exchanges. Alternatively, you can also transfer to Wirex (note: referral link for 25% off plastic card) and get a plastic bitcoin debit card, and withdraw your money from any ATM (but note the exchange rate).
Disclosure: I am affiliated with Wirex. Here’s an article of a case study on how a small business used Wirex to accept bitcoin. If you download Wirex app (android, iOS compatible), you’ll get to claim a free virtual bitcoin debit card to play around with.
Bitcoin debit card?
Yep. Not many places accept bitcoin as payment yet, but if you have a bitcoin debit card it makes it easier to spend it. Bitcoin debit cards are linked to Visa/Mastercard etc, so effectively you’ll get to spend it at millions more places. Here’s an article I wrote about the cards’ usefulness, published on CompareHero. Use this referral link to get 25% off plastic Wirex cards).
ProTip: Use my referral link to register an account, then install the Wirex app (android, iOS) and get free virtual card (tutorial). This way, you get both free virtual card AND the 25% plastic card discount.
EDIT: Due to a Visa ruling that affects ALL bitcoin debit cards worldwide, card orders are temporarily unavailable to non-European customers. You can still make use of the Wirex bitcoin wallet and pre-register for the new contactless crypto cards, coming out soon. Wirex-to-Wirex transfers are free (save on fees).
If you prefer locally-issued credit cards instead, read my Hack: How to Maximise Cashback Credit Cards article.
Where can I buy hardware wallet for bitcoin storage in Malaysia?
I briefly touched on bitcoin storage above. There are several ways to keep your bitcoins safe. One of the most secure options is with hardware wallets, which essentially takes your bitcoins off the internet, so no one can take it. If you have a significant amount of bitcoins, it’s a good idea to get one of these for safe storage.
Disclaimer: I was sponsored a Ledger Nano S from BitStore.com.my. The other popular option for bitcoin storage is Trezor hardware wallet. Sometimes you can find people selling them on FB, Lowyat or Mudah, but you also make direct and online purchases from the respective official shops.
Where can I hang out with other bitcoiners?
Facebook. If you type in ‘Bitcoin Malaysia’ in the search, a few will pop up. NOT ALL ARE GOOD – some promote HYIP/Ponzi schemes and some allow bitcoin buying/selling without escrow (no protection to both buyer and seller, easy to lose money this way).
The ones I can vouch for:
These should be ok to join, they have ok-to-good moderation. The majority of other bitcoin groups and pages look super spammy. Enter those at your own risk.
We’re also on Whatsapp and Telegram. I don’t have authority to give you access to these groups.
Yes. Don’t lose money to scammers. If you have specific questions not included here, comment below and I’ll get back to you.
Obligatory disclaimer: The above is my opinion, and shouldnot be taken as financial advice. By reading this, you agree that you won’t hold me liable for any losses you may make. If you profit, good for you.
If bitcoin is not for you, there are plenty of other investment opportunities in Malaysia. Check out my investing with RM1000 article.
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