Luno App Review — The Crypto Underdog?

Luno is an ambitious fiat to crypto exchange which aims to bring cryptocurrency to the world at large, not just first-world countries. They have an almost zealous drive to promote and educate users about crypto, not only providing their exchange service, but educational tutorials instructing potential clients about how crypto works, what it is exactly, and all the steps involved in safely buying, storing, and selling it.

The company provides peer to peer matching for secure crypto transfer or sale and allows users to easily withdraw or deposit crypto into and from their Luno wallets. While this isn’t exactly ground-breaking, it works well and is very reliable, which is something most people want when dealing with currency.

Luno app review — What I thought

During my use of the Luno app, I found it incredibly easy to use, even as someone who doesn’t dabble in too much crypto. I definitely wouldn’t call myself an enthusiast. Yet Luno offered incredible simplicity and instruction on the process of buying, selling, and storing cryptocurrencies like Ethereum, Bitcoin and Ripple. There were tons of guides and instructional tutorials available to me which I was very appreciative of, though I could see a lot of the information being redundant for more experienced crypto traders.

Practicality aside, I found the app to be very well designed and extremely sleek, offering a stylish appearance often seen in modern crypto and investment apps such as Robinhood and Etoro. This seems to be a trend in the newer investment and money management apps, as they move away from the outdated, dry designs that once pushed away younger and newer investors. 

Pros

Cons

  • Easy to use and trade
  • Very instructional and helpful app
  • Aesthetic app
  • Unregulated, but has a good track record
  • No crypto to crypto trading
  • Very few advanced features

How Luno works

The pioneering app provides its service by pairing users to exchange fiat to crypto using the Luno wallet, which can then transfer bought crypto to a different, external wallet. The exchange doesn’t necessarily store the crypto on their books, but pairs clients and facilitates a trade through their affiliated payment processors, such as BitGo. You deposit fiat currency, or link a crypto wallet to their Luno wallet, and then either buy, sell or transfer crypto through their platform, paying them fees in some cases.

luno-crypto-news

In my use of the app, I found it to process transactions quickly and with minimal slippage, though as their site states, depending on order flow, prices can vary by quite a lot, even being double the “normal” rate on a particularly chaotic day of trading volume. This can still be less than what you would find on other exchanges though, as sometimes I’ve been hit with massive slippage or processing delays and lost out as a result.

What currencies are available?

Luno offers a decent range of crypto and fiat pairs, and you will find most of the commonly traded cryptos. The current cryptos offered by the exchange are as follows:

  • Bitcoin (BTC)
  • Ripple (XRP)
  • Ethereum (ETH)
  • Litecoin (LTC)
  • Bitcoin Cash (BCH)

The biggest drawback about the platform is the inability to do crypto to crypto trades, which is fairly common on other exchanges and will be a feature sorely missed by a lot of crypto traders. I’m a bit surprised that interest on crypto is offered while pair trading isn’t, but either way there are alternative exchanges if that’s what you’re looking for.

Savings Wallet

Surprisingly, there are crypto savings wallets available on the app. While this is becoming a more common feature, it’s still surprising to see this on an app this small, as savings and crypto derivatives are a relatively new, risky, and complicated process mostly handled by large exchanges. The interest offered depends on the coin but ranged from 2% on BTC to over 7% on USDC.

luno-interest-crypto

Instructional content available

One of the surprisingly positive aspects of the app as a new user of crypto, was just how informative it was and detailed in the help available. Luno provides in-depth instructional videos and training articles on a wide range of topics about crypto relating to safety, use and risks. I don’t usually see this level of advice on a trading and storage platform, and it’s definitely designed with a wider new userbase in mind. As the target audience, I can say it worked relatively well and I found myself not only more interested in crypto, but more sure of myself that I wasn’t exposing my wallet to any unnecessary risks.

luno-tutorial-video

In addition to helpful advice, the app also provides up-to-date crypto news in the form of what seems to be an all-inclusive newsfeed relating to live crypto prices, regulatory decisions, and general information about developments in the world of cryptocurrency. I think I spent about half an hour going through this section once I found it. Very impressed with the quality of the content here.

What are the fees?

When it comes to cost while using Luno’s services, it will highly depend on your region, currency and how much volume the cryptocurrency network is processing, reflecting supply and demand of trade processing. This means the fees are never flat when you are exchanging or sending currency as a variety of factors affect the final price you pay.

While sending crypto to and from an address is charged a fee, sending it between a mobile platform or an email address is free, as there is no fiat exchange or processing cost. Most of the time, the fees are paid by the seller of crypto and not the buyer, and these fees are usually less than 1% and generally around 0.5% which is relatively good as far as crypto exchange fees go. However, there is a flat fee charged whenever fiat is withdrawn from your Luno account, and this depends on the size of the transaction but is generally no more than a pound.

Is it worth it?

For what it does, the app provides relatively good value, and there are definitely more expensive options out there to buy and sell crypto. I never like cash withdrawal fees, but in reality, these fees will usually come out somewhere, whether in the spread of a trade or by a slightly higher exchange rate. At least Luno is very clear about their fees, especially the sliding processing fee which depends on order flow. A lot of exchanges try to hide this fact, but Luno is very clear about it, even pinning it on the main app page with an explainer video about how it works exactly.

luno-wallets

Is it safe?

Luno is known as a trustworthy exchange among its users and has a surprisingly good track record and security protocol for a relatively small exchange. Backed by SSL encryption and completely hashed data, there’s not too much to worry about when buying crypto with the exchange or transferring funds. A series of multi-signature cold storage wallets are used to store users’ money and are only accessible if approved by a majority of the 5 multi-signature blockchain users assigned to each.

In the “hot wallet” option that Luno offers, they hold one key and the other is held by BitGo, which is a renowned payment processor. This means that for someone to steal your wallet, they would have to compromise both Luno and BitGo at the same time. This makes it relatively secure for a hot wallet.

Invite a friend

The app offers a generous referral reward scheme amounting to £10 worth of Bitcoin for both you and your referred friend when the terms are met. This is surprisingly good for the market as most rewards are usually around the £5 mark, and that it’s provided in crypto is a good incentive to get your friends into trading it with you.

luno-invite-friend

Conclusion

While I find Luno a great concept to bring crypto to under-represented regions, I can’t find any real benefits of using the app over others such as Binance or Coinbase as they generally offer a lot more services, including crypto to crypto transactions. The fees are not all that different either. Luno does work well on cost, especially serving international countries with lower costs of living, but as a UK national, I can’t see much value in using it over their competitors (aside from when Binance stops working!).

In the end, it’s not a bad exchange app, and there are no particular reasons not to use it, but there aren’t any ground-breaking reasons to use it either, so I would personally cut out the extra steps and missing services and just go for a bigger name exchange for ease of use and simplicity.

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