Smart Investor Malaysia


5 Things We Learned through Luno Malaysia Review


Recently, Luno held a virtual media conference to reflect on a year of operations since its relaunch in Malaysia, sharing its achievements to date and plans for 2021.

Having originally entered the market back in 2015, it quickly became the platform of choice for Malaysians to purchase and trade bitcoin, before being forced to suspend operations while being audited by the Securities Commission Malaysia (SC). After securing approval, it relaunched in October 2019 and has gone from strength to strength.

Here’s five things we learnt about the digital asset exchange (DAX) during the presentation:

2020 Was a Stellar Year for Luno Malaysia

According to Luno Malaysia Country Manager Aaron Tang, the DAX has processed a cumulative total of RM827 million since its relaunch.

It also claims to hold approximately RM165 million worth of digital assets on behalf of their customers, spread across Bitcoin (BTC), Ethereum (ETH), Ripple (XRP) and Litecoin (LTC).

LUNO relaunch in Malaysia
Luno relaunched in Malaysia back in October 2019.

These figures clearly show that there is a healthy demand for cryptocurrencies in Malaysia. According to Luno, 68% of its users buy cryptocurrencies for investment purposes, while 10% conduct trades on the platform, and a further 8% use it for sending and receiving cryptocurrencies.

Luno is the Runaway Market Leader in Malaysia

Claiming to hold over 90% of the market share among the regulated DAXs in Malaysia, Luno has certainly made the most of its past year!

The platform currently boasts more than 180,000 registered users, and given that Luno was the first Securities Commission-approved DAX in Malaysia, it not surprising that they have leveraged their first-mover advantage to great effect.

With the recent surge in the price of bitcoin and other cryptocurrencies, we think it is a pretty safe bet that this number will continue growing exponentially in the near future.

Bitcoin Isn’t Just for Risk-Taking Youngsters

More seasoned investors may have the idea that the volatile, high-risk nature nature of investing in cryptocurrencies is only suitable for younger people that are looking to make a quick buck off the huge swings.

However, for Luno this is far from the case.

According to Tang, the majority of Luno’s customers are aged between 30-49 years old. These are people in their prime working age, with the demographic mostly made up of accountants, engineers, educators and entrepreneurs.

This trend is also reflected globally, with institutional interest from the likes of Grayscale and PayPal credited with driving up the price of bitcoin in recent times.

Who says cryptocurrency is just for millennial and Gen Z investors?

2021 Promises to be an Exciting Year for Luno

On plans for 2021, Tang shared that Luno aims to launch a Savings Wallet for customers, where they will be able to allocate bitcoin to an interest-bearing account which allows them to earn 3-4% interest per annum on their holdings.

While this feature is already available for Luno users worldwide, it is currently under review by the Securities Commission Malaysia (SC).

luno malaysia new features - luno relaunch
Some of the features Luno Malaysia introduced in 2020.

The company also plans to introduce new cryptocurrencies to the platform in 2021, subject to regulatory approval. Tang would not divulge which coins were under consideration, but the pending introduction of more assets to invest and trade in should help to bolster Luno’s position as the clear market leader in Malaysia.

Luno is About as Safe as it Gets

The issue of safety is one that retail investors often have when purchasing cryptocurrencies on a particular platform, with more seasoned cryptocurrency owners often championing the practice of storing digital assets on a privately-owned wallet instead of a platform.

However, Tang was quick to elaborate on the extensive security measures that Luno has in place to safeguard customer assets.

luno malaysia country manager aaron tang - luno malaysia relaunch“Any regulated platform in Malaysia must have their security systems audited and vetted by the Securities Commission,” he said.

“This is the first point of confidence that consumers can have, in that you are dealing with a regulated platform that must prove that its systems are safe and secure.”

In terms of asset storage, Luno works with the digital asset custodian BitGo to secure its “hot wallet” which is directly linked to its platform and facilitates all transactions.

The majority of its customer assets are stored in “cold storage” (not connected to the internet), rendering it impossible for hackers to gain access to it.

A portion of assets are also stored in “deep freeze”, which means they are spread out across several vaults in separate locations, spanning multiple continents around the world.

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