• Saturday, May 18, 2024
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Luno sees record cryptocurrency transactions as active users surge amid lockdown

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Global cryptocurrency exchange, Luno said on Thursday that the leading cryptocurrencies like bitcoin, Ethereum, Bitcoin Cash, and Ripple, on its platform have seen record-breaking activities since the coronavirus pandemic forced many investors to stay at home.

In a release sent to BusinessDay, while trading volume has doubled since the start of March, the number of active users month-on-month rose by 50 per cent. It is the highest number of active users since April 2019. In Africa, the cryptocurrency exchange has seen a 25 per cent increase in new customers from the fourth quarter of 2019 to the first quarter of 2020.

Luno is home to more than 3.5 million users across 40 countries worldwide. Nigeria is one of its key markets in Africa.

According to the company, March was its biggest month in terms of both trading volume since August 2019 and within Africa. Bitcoin volumes rose by 100 per cent from February to March.

The company says the record number of active users in March is also an indication that the perceived lack of confidence in cryptocurrencies may be premature.

“We live in unprecedented times, which has brought uncertainty to every aspect of our day-to-day lives,” said Marcus Swanepoel, CEO of Luno. “The markets have not seen this level of turbulence since the financial crash in 2008 and while cryptocurrencies – like any nascent technology – has its sceptics, the early data is reassuring. Not only are many existing investors continuing to invest in leading cryptocurrencies, but an entirely new audience is also looking toward cryptocurrencies for the first time.”

The spread of COVID-19 in 2020 has seen the price of Bitcoin and other cryptocurrencies performing below market expectations. In February, Bitcoin has gone a bull run, crossing $10,000 for the first time in 4 months. It could only sustain the momentum for less than seven days.

In March, Bitcoin’s volatility was back as it suffered severe losses amid a global sell-off. The digital currency’s 30-day volatility reached 167.24 per cent on March 31st, its highest since January 2014, according to data compiled by asset manager Blockforce Capital.

Interestingly, Bitcoin holders were not affected, as data from Luno’s weekly insight showed.

“What’s particularly encouraging is the number of people we’ve seen who are interested in learning about cryptocurrencies, which gives us an indication of how people are starting to think beyond the tried and tested way of managing money that yields no return,” Swanepoel said.

With many new interested parties turning toward crypto for the first time, the Luno Learning Portal serves as a go-to guide for anyone looking to take their first steps into the world of digitised assets.

“There’s been a big education gap surrounding cryptocurrencies for a few years. What can they be used for? How are they used? Where do I even buy cryptocurrencies from? Ultimately, the onus is on us – the exchanges, the platforms, the investors, the advocates – to aid and educate the general public about cryptocurrencies and how they can be used. If we want to see mass adoption of crypto, we need to make sure that people feel empowered to make informed decisions and not like they’re being excluded from a geeky tech club,” said Swanepoel.