Crypto platform Luno plans aggressive African expansion
Cryptocurrency platform Luno, which is backed by Naspers and Rand Merchant Investment Holdings, is planning an aggressive push into at least 18 more African countries, says Marius Reitz, the exchange’s manager for SA.
Luno — which operates in SA, Nigeria, Europe and Southeast Asia — is seeking banking partners across the continent to facilitate its expansion, Reitz said, declining to name which countries the company is targeting.
“We’ve started engaging with banks and regulators,” he said. Luno’s new African regional headquarters in Johannesburg will grow from a team of eight to 40.
Luno published a survey on Friday showing that 69% of respondents in SA said they are familiar with cryptocurrencies, while 29% said that they own a cryptocurrency.
“That’s very encouraging given that bitcoin is 10 years old this year,” Reitz said.
SA and other emerging markets, including Malaysia and Indonesia, “scored higher than most countries in Europe except for Lithuania” in terms of familiarity and adoption of digital coins.
That could be due to stronger appetite for alternative investment options in emerging markets, Reitz said.
The survey is based on 1,000 online responses from people from all age groups and income brackets. While trading volumes have declined since the sharp sell-off of flagship cryptocurrencies such as bitcoin and ethereum in December and January, interest in digital coins has not waned, Reitz said.
“Of course, the December rush was absolutely driven by greed and people acted irrationally, so it was expected, and it’s actually a good thing that the price stabilised to some extent, although it’s still volatile compared to fiat currencies. But in terms of momentum, I don’t think there’s been any backward movement or pause.”
Luno has more than 2-million customers globally. SA is its most important market in terms of trading volumes — in recent weeks, 250- 500 bitcoin exchanged hands in the country daily.
On Friday, a single bitcoin cost R95,451. In December 2017, the price reached a high of R264,825.
Regulators in SA are expected to publish a position paper on cryptocurrencies within the next few months.
It is widely expected that all exchanges will be required to register with the Financial Intelligence Centre, meaning it will be mandatory for exchanges to have proper know-your-customer checks in place and to report suspicious transactions. Regulators may also publish guidelines around the safeguarding of clients’ funds.
Reitz said that while some clients have fallen prey to phishing scams, “Luno has never been hacked”.