Cash To Crypto: What You Need To Know About Digital Currencies Right Now

Crypto arrived in 2009 and went mostly unnoticed for a decade. Slowly, around 10 years ago, it became a buzzword among risk takers; but today it is disrupting the financial landscape around the world. 

According to Statista the global crypto market is projected to hit US$45.3 billion this year—more than some countries’ GDPs! Big names and celebrities like Kim Kardashian, Elon Musk and Snoop Dogg have jumped on the bandwagon too, with Musk’s tweets making Dogecoin skyrocket and Snoop making millions from NFTs.

In line with these emerging trends, Malaysia is also witnessing a surge in cryptocurrency adoption, driven by increased government support and a growing number of local blockchain startups. As per Statista, the projected revenue in the cryptocurrency market for Malaysia is expected to reach around US$290.9 million in 2025. 

However, before getting started with crypto trading and delving into cryptocurrency, it’s important to know the basics—especially with the government rolling out new regulations. Whether you’re thinking about trading, investing, or just getting a grasp on the tech, this guide will help you navigate the digital currency world.

Cryptocurrency and crypto trading in Malaysia: A beginner’s guide

What is cryptocurrency? 

It is basically a digital currency that uses cryptography for security. Unlike traditional currencies like the Malaysian Ringgit (MYR) or SIngapore Dollar (SGD), cryptocurrencies are decentralised. Crypto typically operates on blockchain technology, a distributed ledger that records all transactions across a network. 

The most popular cryptocurrency is Bitcoin. It has made headlines in recent years for its dramatic rise in value, but there are thousands of other cryptocurrencies, each with unique features. A notable example of this in Malaysia is an incident from 2018 where a businessman in Sabah used half a Bitcoin to purchase three acres of land! 

What is crypto trading?

Crypto trading refers to buying and selling of these digital currencies for profits, very similar to stock trading. Crypto prices fluctuate widely, creating both opportunities and risks for traders.

In Malaysia, the process is straightforward, but it’s essential to choose a reliable crypto-trading platform and understand the risks involved. Malaysian exchanges like Luno, Tokenize, and MX Global offer local services and are regulated by the Securities Commission Malaysia. 

Top crypto trading platforms in Malaysia

Making an informed decision when choosing a crypto trading platform is extremely important. Here are three of the most popular crypto trading platforms in Malaysia right now:

• Luno: Luno is one of the most popular crypto-trading platforms in Malaysia. It’s user-friendly, offers a wide range of digital currencies, and provides educational resources for beginners. The platform also supports secure transactions, making it a great option for both newbies and seasoned traders.
  
• Tokenize: Tokenize offers a secure and easy-to-use platform for crypto trading. With a strong emphasis on regulatory compliance, Tokenize has gained trust among Malaysian investors. They offer competitive trading fees and access to a wide range of digital assets.
• MX Global: Another popular platform in Malaysia, MX Global is known for its extensive range of cryptocurrencies and advanced trading features. The platform is primarily designed for experienced traders.

Government regulations and future of crypto in Malaysia

The future of cryptocurrencies in Malaysia looks promising, with growing interest from both individual investors and institutional players. As blockchain technology matures, different industries, such as finance, real estate, and logistics, are exploring how to integrate digital currencies into their operations.

Bank Negara Malaysia has issued guidelines on digital asset activities, particularly focusing on the risks of digital currencies. While cryptocurrency is not recognised as legal tender in Malaysia, it is allowed to be traded as a commodity under the Capital Markets and Services Act 2007. Earlier this year, in January, Prime Minister Datuk Seri Anwar Ibrahim engaged in discussions with officials from the United Arab Emirates and Binance co-founder Changpeng Zhao to develop a comprehensive policy framework for digital finance. 

Lastly, here is a quick FAQ for those looking to try their hand at crypto trading in Malaysia

FAQs for crypto trading in Malaysia

Is cryptocurrency legal in Malaysia? 

Absolutely, but with some caveats. No, you can’t yet pay for your morning nasi lemak with Bitcoin. However, trading digital currencies is permitted under the watchful eye of the Securities Commission Malaysia. They ensure that exchanges adhere to regulations, keeping your investments as safe as possible.

What is the best crypto-trading platform for beginners in Malaysia? 

Luno is often recommended for beginners due to its user-friendly interface, educational resources, and secure trading environment.

Are my cryptocurrency investments safe? 

While licensed platforms in Malaysia are regulated and offer security measures, cryptocurrency trading carries inherent risks due to market volatility. It’s important to do your homework and invest wisely.

Can I make money from crypto trading in Malaysia? 

Yes, it’s possible to make money from crypto trading, but research, strategy, and a good understanding of the market are essential for success.

Is Crypto Halal? Are there Shariah-compliant options in Malaysia?

In 2023, Halogen Capital launched the country’s first Shariah-compliant crypto funds, including the Halogen Shariah Ethereum Fund (HSETHF) and Halogen Shariah Bitcoin Fund. These funds are overseen by Shariah advisory firms like Tawafuq Consultancy and Amanie Advisors.