Luno, a cryptocurrency trading platform, has announced plans to commence Naira deposit and withdrawal on its platform through a third-party application.
In a statement forwarded to all users on Wednesday, Luno management said customers in Nigeria will be able to deposit and withdraw funds in Naira.
However, customers are required to first upgrade their KYC information on the platform. “Failure to do so will mean you cannot deposit or withdraw Naira. This is necessary to ensure your security and that of your funds,” the company stated.
To read more on how to upgrade and verify on the Luno platform click here.
This is coming several months after the Central Bank of Nigeria (CBN) restricted deposit money banks from facilitating cryptocurrency payments to protect Nigerians from another MMM and unregulated crypto space with numerous cases of frauds and scams.
Platforms like Binance, the world’s leading crypto exchange platform, had launched a peer-to-peer deposit and withdrawal mechanism to ensure Nigerian customers continue to transact on the platform despite the restriction.
Explaining how Luno would achieve Naira deposit and withdrawal given CBN restriction, the Luno team said customers would be able to deposit and withdraw funds on the platform through vouchers they would purchase and redeem via a trusted third party.
“You will be able to deposit and withdraw funds to the Luno platform using vouchers purchased and redeemed through a trusted third party provider,” the Luno team said in the statement forwarded to all customers.
“We believe that this is the safest and easiest-to-use solution currently available to our customers in Nigeria and look forward to you experiencing it for yourselves.”
However, Luno said while it only facilitates payments between customers, it does not set the price of Bitcoin or any other currencies. This, it stated to address a possible fluctuation in price of currencies once it rollout its new third-party voucher deposit and withdrawal model.
“Luno does not set the price of bitcoin or any cryptocurrencies, we only facilitate transactions between customers.
“The return of Naira deposits and withdrawals may cause significant price volatility, with the release of pent-up customer demand to buy and sell cryptocurrency causing unusual market behaviour that could last for several weeks.
“Stay tuned for more details about the voucher solution and how to use it in the coming weeks!”
Meanwhile, Digital Currency Group (DCG), the parent company of Luno, just raised US$700 million in an investment round led by SoftBank’s Vision Fund II and Latin American Fund. Other equity investors led by the two funds include Google’s Capital G, Ribbit Capital, GIC, Tribe Capital and Emory University who purchased stock from existing investors.
This put the company’s valuation at US$10 billion.