Digital Currency Group (DCG), a New York-based global enterprise that builds, buys, and invests in blockchain and cryptocurrencies companies, has announced its acquisition of South Africa's largest cryptocurrency exchange - Luno.  DCG, along with South Africa's Rand Merchant Investments (RMI), were early investors in Luno.

As part of the acquisition, DCG has said one of the important things it will be doing is to make a financial commitment to "help Luno expand globally, both in geographies where Luno currently operates and beyond."

“The past seven years has been an incredibly exciting journey for Luno – helping millions of our customers get access to crypto for the first time. DCG has been an integral part of the Luno story during this time, and we’ve been fully aligned on our vision and culture since day one. Having the full backing of DCG just as we’re experiencing such a pivotal moment of growth in the industry is not just an exciting and important milestone for Luno, but more importantly it will significantly accelerate our ability to reach our goal to help upgrade one billion people to a better financial system by 2030,” said Marcus Swanepoel, CEO of Luno.

South African-founded Luno, the country’s largest cryptocurrency exchange, has been acquired by New York's Digital Currency Group (DCG).

Luno takes cryptocurrencies global

Despite cryptocurrencies, and especially Bitcoin, getting a lot of bad publicity and reputation over the years in mainstream media, Luno has managed to grow globally and take crypto trading globally. Founded in 2013 in South Africa, the cryptocurrency exchange now reports that it has approximately 5 million customers globally.

The company now has a presence in 40 countries as close to 400 employees based in England, Singapore, and South Africa.

Not only has Luno become a leading cryptocurrency exchange in many developing countries, it is also a leading crypto exchange in several countries that have the highest percentage of cryptocurrency ownership, including South Africa (third-highest of its citizens owning digital currencies), Nigeria (fifth-highest), Indonesia (sixth-highest), and Malaysia (tenth-highest).

“We are proud to have supported Luno as an early investor, and we recognize a shared commitment to building mission-driven companies that can help transform traditional financial services and improve economic freedom for people all over the world. Luno is a high growth, global business and there is a massive opportunity to expand organically and through acquisitions," said DCG Founder and CEO Barry Silbert.

Return on investment

Another early investor in Luno, RMI, through its fintech investment arm, AlphaCode, is also celebrating the news of DCG fully buying the cryptocurrencies exchanges. Although details of the transaction and amounts involved have not been disclosed, RMI has said that it sold its stake in Luno for cash to DCG at an "attractive price."

During 2017 Luno concluded its Series B fundraising round after receiving approximately $9 million various from investors.  The round was led by London-based Balderton Capital. AlphaCode and DCG also participated in the round.

“We are delighted by this transaction as it is AlphaCode’s first exit and well above our targeted IRR of 25 – 35% for our fintech investments. We have enjoyed working with the Luno team and still believe in the potential of cryptocurrencies and Luno’s solid growth potential. We supported management selling the business to DCG as it is very well positioned to leverage the platform. We wish the Luno team and DCG all the best and will be watching their future success with interest," said Dominique Collett, RMI senior investments executive and head of AlphaCode.

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