Luno says locals are still watching crypto

  • Luno says there is still interest in cryptocurrency locally despite rising volatility amid regulation and uncertainty in the market.
  • Trading volumes on Luno are climbing and as many as 250 000 customers in South Africa engage with the Luno app weekly.
  • While those who invest are said to be looking at the long term, it remains to be seen if even long-standing cryptocurrencies weather the ongoing winter.

Before ChatGPT, before the metaverse, and before NFTs, cryptocurrency was the tech on everybody’s lips. The massive gains made by early adopters tempted folks to invest in crypto for themselves to varying degrees of success.

Since the heady days of cryptocurrency, a so-called winter has descended on the financial mechanism as both regulators have reigned in both tokens and operators as various scams have come to light. That’s not even mentioning the likes of FTX which is accused of running a Ponzi scheme to misuse customer funds.

“It’s been an eventful year in the crypto market with many regulatory movements and conversations making headlines,” Luno country manager in South Africa, Christo de Wit said in a statement.

“Ethereum successfully executed the Shanghai merge which means that staked Ethereum can now be withdrawn from the blockchain. Bitcoin and Ethereum often draw the bulk of the interest, and we’ve seen a lot of focus and attention on other altcoins and meme coins. The aggressive gains from these tokens are often short lived and they border on the riskier side of the spectrum,” he added.

Despite the risk, South Africans using Luno appear to have maintained their interest in cryptocurrency.

The country manager reports that Luno is seeing “consistently higher trading volumes in South Africa, which give us the confidence that the crypto market is still very active – even when markets contract.”

“In terms of customer activity, we can see that more than 250 000 customers in South Africa engage with the Luno app weekly. This means that people are keeping a close eye on market movements – checking in and staying informed. We also have a large loyal customer base that actively transact, building their portfolios,” said de Witt.

The country manager goes on to say that many cryptocurrency investors who believe it is the future of money are looking at the longer-term rather than chasing short-term gains.

But will cryptocurrency rally once again?

That much isn’t clear, but pressure on the market is rising. The BBC reports today that MPs in the UK have urged the government to treat retail investment in cryptocurrencies as it treats gambling.

Further more the EU has ordered that firms that wish to issue, trade and safeguard assets in the region need to obtain a licence to do so. Ministers in the EU took steps to combat tax evasion and using cryptocurrency to launder money according to Reuters.

There is still an inordinate amount of risk surround cryptocurrency and with heavyweights like Bitcoin losing ground after Jane Street and Jump Crypto took a step back from crypto trading in the US.

While there might still be those holding on to investments locally, it will be curious to see how the financial instrument holds up should those same pressures start to rise here.


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