Can You Use Bitcoin to Buy a Car in Malaysia?
A Proton dealer in Seri Kembangan made headlines recently when he hung a banner announcing that the dealership accepts Bitcoin and Ethereum (another cryptocurrency) as payment for cars. Of course, it got netizens talking (or rather, typing). So many questions!
Firstly, the value of cryptocurrencies fluctuate like crazy. In the morning, it could be US$17,000; by evening, it could drop to US$15,000. If it goes up immediately after the transaction, the buyer would have, in a sense, paid more than the value of the car; if it goes down, the dealer’s profit margin drops quite suddenly. To address this, the Proton dealer, a Mr Tony, said he would charge an extra 2% of the invoiced amount as buffer.
Then there is the question of legality. The Malaysian central bank does not deem cryptocurrencies as legal tender (yet), but wants the operators to start reporting their activities. In a statement issued last month, Bank Negara said: “The invocation of reporting obligations on digital currency exchangers is the first step towards making digital currency activities more transparent in Malaysia.”
Despite Proton asking him to take the banner down on Friday, a day after he put it up, Tony has had at least 10 customers walking in to enquire about the cryptocurrency payment option.
Now, if he does make any sale this way, Tony would need to convert the virtual currency into cash quickly, unless he has a hefty pile of float moolah. But it doesn’t sound like he does. In fact, it sounds like he is resorting to accepting Bitcoin and Ethereum out of desperation (or perhaps, marketing ingenuity). He told Malay Mail that he was “just trying this approach to go by this difficult period” and that this was his “last step before I close shop”. So sad!
According to Tony, in the same Malay Mail article, sales of Proton cars have dropped to below 10 units a month compared to about a hundred before the GST was implemented. Yesterday, Proton issued a statement that it was suspending Tony’s operations until further investigation. Tony just can’t catch a break. Poor Tony!
image credit: Lowyat forum user Xccess