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Luno Review 2020: Pros, Cons, Fees, Features, and Safety

Luno is a bitcoin cryptocurrency exchange and a payment service provider with a market capitalization of $3.7 million. But is it a reliable platform? Read on to find out why we think there are better options out there than Luno.
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Author: cate ellen
Last Updated: 28 July 2020
We do not recommend this exchange. Read on to find out why we think there are better alternatives out there.


Luno is a bitcoin exchange and payment service operating in 40 countries across Europe and several developing and middle-income countries. With a zealous mission to educate the world about cryptocurrencies and how to trade them, Luno has been compared to the E*TRADE of the online trading revolution of the 1990s. We have conducted an in-depth review of fees, features, and pros and cons to evaluate the demand for Luno’s crypto trading and payments services. While Luno is providing a valuable service by helping the world easily exchange and spend crypto in the mainstream economy, investors may prefer an exchange like eToro for U.S. customers and Plus500 for UK traders which are both regulated and safe and where you can trade in real-time trading across multiple assets classes.

On this Page:

    Our Recommended Crypto Exchange for U.S. customers

    OUR RATING

    • 16+ Cryptos + Wallet Available
    • Paypal available
    • Licensed and regulated in the U.S.
    • Social trading Platform & copy trading
    • Low trading fees
    eToro USA LLC; Virtual currencies are highly volatile. Your capital is at risk.

    Our Recommended Crypto Exchange for non-U.S. customers

    • £/$100 Minimum Deposit
    • Has the most popular crypto pairs
    • No commissions on all crypto purchases
    • CySEC & FCA regulated platform
    80.5% of retail investors lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

    What is Luno?

    If you are looking for an exchange to buy cryptocurrency pairs across dozens of different cryptos, Luno is not the best option. What Luno does do it does very well. The exchange offers trading in bitcoin and ethereum, the two largest coins by market capitalization, across fiat currencies. The Luno wallet and payment app make it easier than ever to send, receive and spend your crypto and fiat. Education is provided through the Luno Learning Portal and blog for the beginner bitcoin trader.

    Luno makes using crypto in the real world easy. You can convert your crypto into your local currency at any time and spend it. Some exchanges offering over 100 crypto pairs to trade, on the other hand, do not offer any on-exchange option to convert to fiat. Instead, you have to withdraw your funds to your own digital wallet and find your own crypto-to-fiat solution. Large crypto-to-crypto exchanges like Kraken and Binance come to mind. Luno is for the trader who foregoes purchasing a Ferrari to drive in a low speed limit zone when a Toyota will do. The alternative does the job and is cheaper and more efficient. Luno’s market capitalization is $3.7 million.

     How does the Luno work?

    Luno provides trading of bitcoin against five fiat currencies. They are the Euro (EUR), Indonesian Rupiah (IDR), Nigerian Naira (NGN), South African Rand (ZAR) and Malaysian Ringitt (MYR). Ether (ETH) is also traded. The Luno Brokerage Service offers the market price, whereby crypto can be instantly bought or sold at the quoted exchange price. Business accounts can be opened for businesses that want to accept cryptocurrency payments from customers; pay invoices in crypto; or buy, sell and trade crypto. We would not be surprised to see even bigger developments from Luno in payment services in the future. One of its original investors is South African e-commerce payment giant PayU.

    What cryptocurrencies does Luno support?

    In addition to the bitcoin cryptocurrency pairs listed below, you can buy ETH. You cannot buy Ripple, other majors or alt coins on LunoBitcoin (BTC)

    1. Ethereum (ETH)
    2. BTC/ZAR
    3. BTC/NGN
    1. BTC/EUR
    2. BTC/IDR
    3. BTC/MYR

    Supported countries

    Luno is one of the UKs cryptocurrency exchanges offering cryptocurrency trading on three continents.

    Luno is available in the following countries:

    • Austria
    • Belgium
    • Bulgaria
    • Croatia
    • Cyprus
    • Czechia
    • Denmark
    • Estonia
    • Finland
    • France
    • Greece
    • Guernsey
    • Hungary
    • Iceland
    • Indonesia
    • Isle of Man
    • Italy
    • Jersey
    • Latvia
    • Liechtenstein
    • Lithuania
    • Luxembourg
    • Malaysia
    • Malta
    • Monaco
    • Netherlands
    • Nigeria
    • Norway
    • Poland
    • Portugal
    • Romania
    • San Marino
    • Slovenia
    • South Africa
    • Spain
    • Sweden
    • Switzerland
    • United Kingdom

    Fees & limits

    Trading fees for buyers (makers) and sellers (takers) decline on a siding scale based on increasing trading volume.

    MarketMaker FeeTaker Fee
    BTC/EUR 0.00% 0.25%
    BTC/IDR 0.00% 0.20%
    BTC/MYR 0.00% 1.00% >BTC 0.00* 0.75% >BTC 10.00* 0.50% >BTC 100.00*
    BTC/NGN 0.00% 1.00% >BTC 0.00 0.75% >BTC 10.00 0.50% >BTC 100.00
    BTC/ZAR 0.00% 1.00% >BTC 0.00 0.75% >BTC 10.00 0.50% >BTC 100.00
    ETH/BTC 0.00% 0.25%

    Deposits are free in Europe and Malaysia. Fees may apply in Indonesia, Nigeria and South Africa.

    A small withdraw fee is charged per transaction and varies by country (e.g., Euro 0.30).

    A fee is charged for sending and receiving money via bitcoin addresses.

    Luno Dashboard

    Buying cryptocurrency means different things in different countries on the Luno exchange. The two options are Instant Buy or Sell and an Exchange Trade.

    Instant Buy or Sell

    In European countries, you are basically placing a market order and accepting the current market price. It is analogous to going into a shop and accepting the retail price for your goods.

    Exchange Order

    Customers in South Africa, Malaysia, Nigeria and Indonesia can enter a trade to buy a bitcoin-fiat pair on the Luno exchange. This feature allows you to set a Limit order at the price you want to pay.

    How to Buy Cryptocurrency on Luno: Step-by-Step Tutorial

    The Luno exchange interface is one of the most user-friendly we have come across. All the basic tools are present to analyze a price chart, trade bitcoin, follow open orders and review trading history.

    Step 1: Register your account

    Select Sign Up and enter an email address and password. Confirm the registration by following the link in the email you will be sent. Login into Luno. Next, you will be prompted to provide your mobile number and then enter the code received in the SMS message.

    Step 2: Verify your identity

    Before you can trade, the next step is ID verification. The ID required depends on your level of verification. In Europe, for example, the trading levels for Deposits/Withdraws and corresponding ID requirements are:

    Level 1 – 1,000/1,000 Euros – Confirm mobile number and basic personal details
    Level 2 – 5,000/5,000 Euros – Submit photo/scan of government-issued ID and selfie photo
    Level 3 – 100,000/100,000 Euros – Submit proof of residential address

    Step 3: Fund your account

    From the main menu, choose Wallets. Choose the wallet for the currency you want to deposit, which is Euro in this example. Deposit options will vary from country-to-country. In this example, Euro is being deposited from a UK bank account by a SEPA bank transfer.

    Step 4: Buy cryptocurrency

    Instant Buy or Sell orders can be executed in European countries. Outside Europe, the exchange trading option is also available. In placing an Instant Buy or Sell order, you are basically placing a market order and accepting the current price.

    Select Buy from the homepage. Choose the cryptocurrency you want to buy and the one you want to spend. Enter the amount and click Next and then Confirm.

    Customers in South Africa, Malaysia, Nigeria and Indonesia can enter a trade to buy a bitcoin-fiat pair on the Luno exchange. The trade feature allows you to set a Limit order at the price you want to pay. The order is pending until it is filled or cancelled.

    Step 5: Withdraw your funds

    If you want to withdraw money from your Luno wallet to your bank account, first ensure your ID is verified and your bank account is linked to Luno. Select Wallets from the main menu. From your wallets, choose your local currency account. Click Withdraw. Enter the amount you want to withdraw and select the bank you want to with draw to. You will be asked to enter your Luno pin code to confirm the withdrawal.

    Is Luno regulated?

    Although Luno is not a regulated exchange, within 10 years the exchange expects all countries will require cryptocurrency exchanges to be regulated. Luno plans to migrate to a regulated model as regulation sweeps the globe. Within the next two to three years, Luno anticipates becoming licensed in four or five of the markets it currently operates in.

    Is Luno safe?

    Luno has “bank-grade” security measures in place. Luno stores the private keys of its customers in a safe place it calls the “deep freeze.” The keys are kept in safety deposit boxes in a bank vault, and Luno claims no person has access to more than one safety deposit box. Here is an overview of the security measures in place at Luno.

    • Customer private keys are encrypted and stored in the deep freeze in a bank vault
    • A hot wallet requiring multi-signatures is used for instant withdrawals
    •  Multi-sig keys are required to make a transaction
    • Two factor identification is required to sign into an account
    • Use of a password generator is advised to create a strong account password (e.g., Lastpass, Keychain, Keepass)
    • Regular financial and security audits ensure funds are safe
    • All traders must be verified before using the exchange and personal information is encrypted
    Luno is not currently regulated, although its future plans are to become regulated. Luno stores crypto in cold storage in bank vaults. For investors who want the security of a regulated exchange with money held in mainstream banking institutions, we would recommend an exchange such as Coinbase. The multi-asset social trading platform is launching a cryptocurrency-to-cryptocurrency exchange in Gibraltar where it will be licensed by the Gibraltar regulatory authorities. 

    Is the Luno wallet safe?

    Luno has a free wallet, formerly called the BitX Wallet. The wallet acts like a PayPal of crypto. Users can send and receive bitcoin, ethereum and fiat by email, mobile phone number, QR code, or blockchain address (for cyrpto). With the ability to easily convert your crypto into your local currency, Luno makes it easy to spend crypto.

    If you have doubts as to what the best service for storing your cryptos is, you can compare the best Bitcoin wallets here.

    Does Luno have an app?

    The Luno app is your trading platform, wallet and PayPal all-in-one. All trading functions are accessible in markets that support exchange trading.  Multiple wallets can hold your bitcoin, ethereum and local currency (Find out how to buy Ethereum with PayPal). Access your list of contacts to instantly send crypto or fiat payments by email. The app is available for Android and IOS.

    Is Luno customer service reliable?

    If you need to contact Luno, here is where to start.

    • Help Centre – FAQs are provided on all aspects of how to use the Luno exchange.
    • Email support – Contact Luno by email through Submit a Request.

    Luno Pros and Cons

    Pros:

    • Quick and easy way to trade bitcoin against fiat currencies
    • Easily convert between crypto and fiat currencies
    • Send crypto and fiat email payments for free
    • Businesses can accept and pay in crypto with a business account

    Cons:

    • Unregulated
    • Only two cryptos available to trade (Bitcoin and Ethereum)
    • No margin lending or advanced tradings tools
    • Low liquidity
    • Not available to North American customers
    • Exchange trades not available in Europe

    Conclusion

    In the competitive crypto exchange market, Luno does look like an economy car competing with Ferraris, but with a longer lasting engine. As cryptocurrency exchanges introduce advanced trading features and hundreds of coins to their offerings, Luno is creating real demand for crypto by making it easier to spend it in the real economy. The wallet allows for easy conversion and spending of crypto. Nonetheless, Luno is currently unregulated and for this reason we cannot endorse this platform.

    If you are looking for cryptocurrency trading on a regulated platform, we recommend eToro for U.S. or Plus500 for UK. Their platform is fully regulated and they are providing a safe place to purchase cryptocurrencies. You can also start trading cryptocurrency with just $100.

    Our Recommended Crypto Exchange (US Friendly)

    • 15+ Cryptos + Wallet Available
    • $200 Minimum Deposit
    • Accepts Paypal
    • Trade Stocks, Forex, Crypto and more
    75% of retail investors lose money when trading CFDs with this provider.

    Our Recommended Crypto Exchange for non-U.S. customers

    • £/$100 Minimum Deposit
    • Has the most popular crypto pairs
    • No commissions on all crypto purchases
    • CySEC & FCA regulated platform
    80.5% of retail investors lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

    FAQs

    What is a decentralized exchange (DEX)?

    A decentralized exchange does not use an intermediary to hold customer funds and accounts. Peers trade directly amongst each other (peer-to-peer) and funds are transferred between their cryptocurrency wallets. Trader money and ID are at lower risk of being hacked. A downside of DEXs is the current lack of liquidity.

    What is a centralized exchange?

    A centralized exchange accepts and holds users’ deposits. Most exchanges also conduct ID verification to comply with know your customer (KYC) and anti-money laundering (AML) rules. As a repository of client money and personal identification information, centralized exchanges have a higher risk of becoming a victim of cyber hacking and theft.

    Do I need a digital wallet to trade with Luno?

    If you sign up for Luno, you will receive a Luno wallet to store your bitcoin, ethereum and fiat money. It is a hot wallet. Luno stores your money in cold storage with your private keys.

    What’s the difference between a hot and cold wallet?

    Hot wallets store your crypto assets online and face a higher risk of cyber hacking. Cold storage involves storing your crypto assets offline on a USB drive or paper wallet, for example. Luno’s cold storage wallet places crypto assets in a safety deposit box in a bank vault. The following risk measures should be taken to protect your hot and cold crypto assets:☑️ Generate and store your private keys offline☑️ Use two-factor authentication to access your wallet☑️ Use biometric identification

    How do I send bitcoin for free on Luno?

    If you send bitcoin to a bitcoin address, a fee is charged to cover mining and related charges. Luno let’s you send bitcoin for free by sending to an email address or mobile number. Select Send from the Luno homepage, enter the recipient email or mobile number and the amount you want to send. The recipient will receive the money instantly if they are a Luno customer. Non-customers have 14 days to sign up on Luno.

    A-Z of Bitcoin Exchanges

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    Remember, all trading carries risk. Past performance is no guarantee of future results.
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