- Luno recently announced its plans to lay off 35% of its Workforce on the 1st of February.
- In 2020, DCG officially purchased the Luno crypto exchange but retained its roots in Africa.
- When the bear market effects dawned on crypt traders, Luno reassured its users that it could handle any transaction. This erupted in light of its sister company Genesis, which struggled to keep up with consumer withdrawals.
The ongoing crypto winter has had adverse effects on Africa’s crypto industry. Africa’s crypto adoption rate has seriously declined over the past few months. As such, the prices of crypto coins have reduced exponentially. The bear market effects have also taken a toll on numerous African crypto exchange platforms.
Unfortunately, due to the tidings of this current crypto winter, crypto exchanges focus on ensuring business continuity. As a result, many crypto exchanges have opted to cut down their staff, equipment, and even several partnerships to remain within Africa’s crypto industry. Luno, a South African crypto Exchange, has suffered a similar fate.
The effects of the bear market have taken a toll on this South African crypto exchange, and it has announced a significant layoff of its staff.
Luno crypto exchange suffers in crypto winter.
Luno crypto exchange is one of the largest crypto exchanges found in South Africa. Its useability and diverse nature are beloved withi its native country and other parts of Africa. However, the US parent company Digital Currency Group owns Luno, similar to Genesis. Unfortunately, both companies had strong connections to FTX. Thus, it was one of the many crypto exchanges severely affected by its implosion. DCG warned its affiliated companies of imminent market dislocation and loss of industry confidence due to its ties with the company.
Unfortunately, its worst fears came to fruition as crypto traders began disassociating themselves from any crypto company remotely having ties with FTX. As it filed for bankruptcy last week, Genesis, Luno’s sister company, was the first to fall.In 2013, Luno, the South African crypto exchange, was formed to cater for easy and affordable crypto trading within Africa’s crypto Industry. The very dynamics, functionalities and vision of Luno inspired many other crypto exchanges. It also garnered the attention of critical figureheads within the global crypto industry. Within a year, Luno attracted round investments from the crypto company DCG and expanded rapidly due to this encounter. Soon after, Luno became the go-to in South Africa for anything involving cryptocurrency.
In 2020, DCG officially purchased the Luno crypto exchange but retained its roots in Africa. As a result, the company continued to expand throughout Africa’s crypto industry and beyond its borders. When the bear market effects dawned on crypt traders, Luno reassured its users that it could handle any transaction. This erupted in light of its sister company Genesis, which struggled to keep up with consumer withdrawals. Although this halted a massive withdrawal rate from Luno, it still did not exempt it from the slow decay of the crypto winter.
This SA crypto exchange gradually had a steady reduction in its trading volume. Unfortunately, even with the slight improvement in Bitcoin’s value, the trading volumes within Luno still need to be higher than their expected target. Genesis was out of the count, and DCG is struggling to operate fully due to the effects of the bear market. Unfortunately, Luno had to make decisive moves to ensure its primary vision of empowering Africa’s crypto industry remained intact.
Luno Crypto exchange cuts 35% of its staff.
As a last resort to save its reputation and entire vision as an SA crypto exchange, Luno recently announced its plans to lay off 35% of its Workforce on the 1st of February.
The company stated that 2022 was an incredibly tough year for the entire crypto ecosystem, leave alone Africa’s crypto industry. Luno was no exception, and its indirect affiliation to FTX caused even more trouble for them than they had hoped. Fortunately, the SA crypto exchange firm has numerous branches, and this decree mainly fell on its London base.
Marcus Swanepoel, Luno’s London-based CEO, informed its employees that this initiative was one of the few ways the company would hope to stay afloat amid his crypto winter. According to Luno’s spokesman, this layoff would mainly affect its marketing teams and will have minimal to no impact on its operating and compliance teams.
The bear market effects have strained numerous crypto exchange platforms withi Africa, such as Nestcoin, which also halted various operations to calculate their moves.
The toll of the crypto winter has drastically reduced Luno’s operations. Swanepoel states that Luno did predict that the crypto industry would experience long-term effects of the bear markets. As a result, they prepared a business and funding model that could be resilient enough to withstand. Unfortunately, the sheer scale and speed required to implement these plans extensively strained their operations. This the SA crypto exchange had no choice but to make a few alterations to ensure its business continuity.
Also, Read the 2022 bear market is a haven for Africa’s crypto market opportunities.
Despite bitcoin’s bounce back, Africa’s crypto Industry is generally struggling to maintain its pace within the crypto winter. Experts have claimed that this won’t be short term and crypto traders and exchanges should brace themselves for an upcoming crypto ice age.
Luno is one of the many struggling with the crypto winter. The only good news comes when more governments steadily embrace the concept of digital assets. Will the SA crypto exchange survive even after this staff reduction strategy? Or will it be forced to trim down on other branches? The effects of the bear market are steadily increasing, but the resilience of African crypto traders is still strong enough.