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Africa’s biggest crypto exchange ramps up global expansion

SETH ONYANGO, BIRD STORY AGENCY

LUNO, which has racked up 10 million customers in over 40 countries, is now combing through different regulations in America’s 50 states before it enters that market.

US entry would give it access to a huge new market but it is also a huge challenge, given that there are different crypto regulations in every state, something Marius Reitz, its general manager for Africa has admitted.

“It is more complex than launching in an individual market because of the different states and different regulations within each of these states, so there are lots of moving parts,” he told Bloomberg in February.

Luno is expected to make initial forays into California, Wyoming, Florida, Florida and Colorado, which have crypto-friendly regulations and are also working to attract investment.

Luno will hope to replicate its South African success. Africa’s southernmost state is one of Luno’s strongest and most active markets and according to Ventureburn, customer growth there is almost 40 per cent year-on-year. Over 40 per cent of all new customers added in the last six months are based in that market – helping the company reach its 10 million

“Reaching 10 million customers is an important milestone which supports a transition towards building a better, more fair financial system,” said Marcus Swanepoel, Luno CEO and co-founder.

Luno’s strategy is seen as critical to its success and global penetration, as it allows customers to buy crypto for as little as R1 or 0.07 US dollars in line with its mission to put the power of crypto in everyone’s hands.

Ventureburn figures show on average, South Africans deposit the equivalent of 32 US dollars when they open their Luno account and tend to hold for 10 months (the longest time of all Luno markets), with 82 per cent of new customers purchasing Bitcoin, while 28 per cent bought Ethereum.

By launching into the American market, Luno will be competing with some of the world’s biggest peer-to-peer crypto trading platforms. The company now employs over 700 people at eight offices on five continents and has global ambitions. Founded by Swanepoel, Timothy Stranex, Pieter Heyns and Carel van Wyk in 2013, Luno was acquired by US crypto leader and investor Digital Currency Group in 2020, giving the company more firepower for international growth.

“There are an estimated 300 million people using crypto worldwide as of March 2022 – a figure that is expected to grow as global markets gain better access to the crypto ecosystem. Luno aims to bring crypto to over one billion people by 2030,” Swanepoel said.

In Africa, South, Nigeria and Kenya have the highest crypto adoption not just on the continent but globally.

Cryptocurrency adoption in Africa grew 1200 per cent between July 2020 and June 2021, making it the fastest adoption rate in the world.

Forecasts suggest that Africa amassed 105.6 billion US dollars worth of cryptocurrencies for the year ending June 2021, driven by peer-to-peer (P2P) transactions in key growth markets.

Trading volumes for several African currencies have especially grown on LocalBitcoins and Paxful, the world’s biggest P2P platforms by transaction volume since 2016.

Digital analytics firm Chainalysis’ latest figures show annual growth of transactions volume – made up of retail-sized transfers – in Africa was seven per cent, against the global average of per cent.

Meanwhile, the growth of cryptocurrency in Africa comes as several countries on the continent are looking to launch their own virtual money, backed and issued by central banks.

Consumers on the continent are increasingly adopting electronic payment methods such as Lipa Na M-PESA, credit cards and payment gateways.