Luno’s Strategic Shift: From Retail Exchange to Digital Asset Infrastructure Provider
After a decade focused on building a retail cryptocurrency exchange, Luno is pivoting towards becoming a digital asset infrastructure provider for institutions. The UK-headquartered firm, which operates in four African countries, aims to offer banks, asset managers, fintechs, and enterprises the tools to integrate digital assets into their offerings.
“Luno would be the rail on which they [institutions] can come into the virtual asset space,” explained Ayotunde Alabi, Luno Nigeria’s CEO and country manager. “For example, if a bank wants the ability to mint a stablecoin, they can plug into our rails.”
The shift reflects a broader evolution in the digital asset landscape, where companies are seeking more sustainable revenue models beyond volatile retail trading.
Key Components of Luno’s Institutional Strategy:
- Crypto-as-a-Service: Providing institutions with pre-built infrastructure for trading, custody, and wallets.
- Cross-Border Settlement Network: Leveraging GTXN’s payments capabilities for efficient international transactions.
- Stablecoin Issuance: Through BlockTower, Luno plans to offer stablecoins backed by local currencies in various markets, including potential naira-backed digital currency for Nigeria.
Luno recently acquired GTXN and has a subsidiary called BlockTower that handles stablecoin issuance. The company’s architecture allows customers to buy and sell cryptocurrencies through Luno, access stablecoins via BlockTower, and use GTXN for payments and settlements—creating an integrated digital asset ecosystem.
The strategy mirrors the evolution of other crypto companies like Coinbase, which initially focused on retail trading before expanding into institutional services and infrastructure solutions.