ENTREPRENEUR: Co-founder of SA’s first bitcoin wallet Timothy Stranex
The co-creator of SA’s first cryptocurrency wallet now oversees the technology of a platform that operates in more than 40 countries
Launched in 2014, cryptocurrency trading platform Luno has "quite literally gone from zero to nearly 2m", co-founder Timothy Stranex says of the number of global customers it has attracted.
That’s remarkable for a new start-up, but seems to match the explosive growth of digital currencies such as bitcoin.
Luno — which initially launched as BitX — is a digital currency app that has been hailed as SA’s first bitcoin wallet. Its users can buy and sell cryptocurrency through it, and it has stood out in a crowded international market thanks to a simple interface and a secure offline vault that stores bitcoin (in case a user ever loses his or her handset).
Luno was created by a team of five in a small office in Cape Town. It now operates in more than 40 countries. Stranex, who is the company’s chief technology officer, is based in the UK.
Soon after the app’s initial rollout in Africa, Luno set its sights on markets such as Singapore, Indonesia, Malaysia, Nigeria and, more recently, the UK and Europe.
"In the earlier years of bitcoin the regulatory situation in most countries was unclear. Singapore was one of the few countries that welcomed cryptocurrency companies."
Today, Luno’s main offices are in Singapore and Cape Town, but it also has customer support centres in other countries.
Stranex is a BSc graduate from the University of Cape Town. He began his career as a software engineer at Google in Switzerland. He worked on Google Maps during his four years at the company, while also completing an MSc in theoretical physics from the University of Zürich.
Stranex first heard about bitcoin in late 2012, when it made headlines for reaching "bubble" prices of around US$15. "Initially I ignored it, but after hearing about it a few times, I dug deeper, read about how it worked and tested my first transactions. I was fascinated by the concept and the early community, and wanted to be involved."
Stranex, together with Luno’s three other co-founders, Marcus Swanepoel, Pieter Heyns and Carel van Wyk, went on to create Switchless, a cryptocurrency platform for a multinational bank.
Stranex says interest from large financial institutions and regulatory bodies erupted, but firms "were too slow to actually launch the platform to their customers". This is how BitX was born.
"As our business grows rapidly, our traffic is doubling every few months." Most of that growth is in emerging markets, where other firms have found it difficult to build reliable verification mechanisms and secure funding.
To help it along, Luno has so far received two rounds of funding. A first batch of $4m came from Naspers, Digital Currency Group and Venturra, and another $9m came from Balderton Capital, Digital Currency Group and RMI/AlphaCode.
Stranex warns about the need for security for currency traders.
"I’d caution people not to get caught up in hype and misinformation in the news. They should be wary of scams, keep secure by enabling two-factor authentication on their accounts and stay alert for phishing and other attacks," he says.
"Cryptocurrencies can be volatile, so people should not invest more than they can afford to lose."