South African residents now have the opportunity to purchase stocks from tech giants Apple and Alphabet in digital form through the platform Luno.
Luno Expands Offerings, Bringing Global Stocks to South African Investors
Luno, a leading cryptocurrency and digital investment platform, is set to revolutionise the South African investment landscape by offering tokenised stocks and ETFs from early August. This move positions Luno as a multi-asset investment platform in the country's fast-evolving financial landscape.
The platform works by offering blockchain-based tokenised representations of real global stocks and ETFs, backed 1:1 by the underlying assets. This innovative approach allows retail investors to gain fractional ownership of over 60 international equities, including tech giants like Apple and Alphabet, using South African rand. Trades are settled instantly and available 24/7, bypassing foreign exchange fees and US market trading hour restrictions.
Luno's regulatory compliance is of utmost importance. The company is regulated by a Tier-1 financial authority and holds government licenses in South Africa and other countries. This ensures that Luno adheres to strict local financial regulations and operational standards, providing a secure platform for investors.
To maintain regulatory compliance and secure custody of the underlying assets, Luno collaborates with infrastructure and custody providers such as Kraken’s xStocks and Backed Finance. These partnerships facilitate the secure custody of the assets and maintain compliance frameworks necessary for regulated trading.
The low entry cost is another attractive feature of Luno's platform. Investments can be made for as low as R20 ($1.13), making global equities accessible to a wider audience. The platform will support over 60 U.S. companies and market indices, including Apple, Alphabet, NVIDIA, and the S&P 500. Customers can invest in fractions of shares, rather than buying a full share at a higher price.
Luno's country manager for South Africa, Christo de Wit, stated that this move offers easy access to global investments at any time of the day or night. The expansion into tokenised equities could bring Luno under closer scrutiny due to potential capital market regulations. However, de Wit is confident that Luno's commitment to regulatory compliance and its partnerships with established infrastructure providers will ensure a smooth transition.
In the rapidly growing digital asset market, Luno competes with platforms like VALR, Binance, AltcoinTrader, and wealthtech apps like EasyEquities and Satrix. The platform's expansion into tokenised stocks and ETFs is expected to attract a significant number of the estimated 5 million South Africans who already own crypto, with digital asset ownership expected to grow by nearly 8% annually through 2031.
South Africa's Financial Sector Conduct Authority (FSCA) is already in the process of licencing crypto asset providers and building a clearer framework for digital securities. This move by Luno could help shape the future of digital investment in South Africa.
In summary, Luno's expansion into tokenised equities provides a secure, regulated, and affordable channel for South African retail investors to access global stock markets through tokenisation technology.
- The expansion of Luno's offerings brings cryptocurrency and digital investment platform technology to South African investors, introducing tokenised stocks and ETFs from August.
- Luno's innovation lies in offering blockchain-based tokenised representations of global stocks and ETFs, allowing investors to gain fractional ownership of over 60 international equities, including tech giants like Apple and Alphabet.
- Regulatory compliance is crucial for Luno, as the company is regulated by a Tier-1 financial authority and holds government licenses, ensuring adherence to local financial regulations and compliance frameworks.
- Luno's expansion into tokenised equities, with low entry costs, aims to make global investments accessible to a wider audience, potentially attracting the estimated 5 million South Africans who already own crypto.
