Cryptocurrency has been on an upward trajectory for most of 2019, and it is showing little sign of slowing as its price continues to tick higher.
Many South Africans will remember the hype surrounding the price of Bitcoin and other cryptocurrencies in 2017, where the market soared for months on end only to plummet at the end of the year.
Some investors managed to cash out during the peak of the fervor, but others were not so fortunate and ended up losing large amounts of money before they cashed out.
MyBroadband spoke to Luno Africa general manager Marius Reitz about the future of the cryptocurrency in South Africa and how Luno plans to cope with another potential price surge.
Price and systems
“Luno doesn’t take a position on the price of Bitcoin, but we believe that Bitcoin as an asset class will continue to appreciate in line with its long term upward trend,” Reitz said.
“Since Luno launched in 2013, we’ve seen many price spikes and we’ve seen many drops.”
“This is the ongoing theme for Bitcoin, so we expect more volatility to follow, as we have seen with tens of similar waves over the past years, but always ending up in a stronger position over time,” he said.
Reitz said that Bitcoin should continue to be a major component of the overall cryptocurrency market regardless of volatility.
He added that Luno has a strong foundation of security and capability through technology, but the platform’s real strength lies in its team.
“We have filled a number of key roles across the business and bolstered our operations and engineering teams to help us scale and build a platform that is not only safe and easy to use but can handle an increase in new customers and transaction volumes,” Reitz said.
This means that Luno should be well-prepared to handle any increase in trade volumes due to sudden increases in price or investment demand, although there has been no shortage of new registrants.
“Luno has had a more than 80% increase in new customers opening Luno accounts from March to June this year, as the price started moving in April, and we have processed about R100 million worth of trades per day on the platform since the price surge,” Reitz said.
Luno has also improved its signup process for new customers to help deal with a potential increase in users, and the company plans to add various new features in the near future.
“We have automated the signup process and customers can now sign up and buy Bitcoin or Ethereum within minutes from installing the Luno app,” Reitz said.
South Africans will soon be able to purchase additional cryptocurrencies on the platform, although these tokens will be vetted carefully by the Luno team before being added to the exchange.
“We will be adding more cryptocurrencies in the coming months, with the first being Bitcoin Cash (BCH),” Reitz said.
“The order in which we introduce them, and the types of coins we introduce, will depend on various factors including customer demand, how high a coin scores in our internal assessments, as well as the resources required to implement them.”
Reiz said that Luno will announce the next cryptocurrency coming to the platform in the next few weeks.