Trust no one … except Luno
For those avid Netflix watchers, you would have seen a Netflix film released this month called “Trust No One: The Hunt for the Crypto King.”
“Trust No One” tells the story of a cryptocurrency exchange named QuadrigaCX, that failed spectacularly without warning. The mystery surrounds the founder, Gerald Cotten, who disappeared without a trace and with all of the exchange’s customer funds along with him. The conspiracy theories ran wild and ranged from faking his own death to murder and even having extensive plastic surgery to hide his identity.
While Netflix has us distrusting others on Tinder and owners of big cat zoos, it does a great job of highlighting the perils of trust without verification and provides an enjoyable watch on something as technical as a cryptocurrency exchange.
Mazars: Luno’s 2022 Q1 Proof of Reserves Report
This Proof of Reserves report is carried out by Mazars, a leading international audit, tax and advisory firm. Mazars’ independent report ensures that globally, all customers’ investments are ‘collateralised’. It gives you external validation that Luno has your cryptocurrency on hand as Mazars test the vast majority of these holdings. This essentially means that they’ve checked that the Bitcoin, Ether and any other cryptocurrencies you see in your Luno Wallet actually exist on-chain or within a custody solution, so you can be sure that your cryptocurrency is always exactly where it should be.
Proof of Reserves and other exchanges
In a recent Moneyweb crypto podcast, Mazars Audit Partner and Digital Asset Lead Wiehann Olivier, provides the questions that you should be asking your exchange. He urges customers to demand that their exchange perform Proof of Reserves verifications, and references Luno who releases these reports quarterly.
Annual year-end audits
Apart from the quarterly Proof of Reserves reports, Luno also embarks on a full financial year-end audit process with Mazars appointed as the Group’s auditors. The audits provide independent verification that the financial results presented are not materially misstated (auditor and accountant speak for saying that the financial results are reasonably correct).
Proof of Reserves reports vs. financial year-end audit
The benefit of the Proof of Reserves reports over the financial year-end audit are that we can release them quarterly (as opposed to annually), they are customer-specific (as opposed to being focused on the company results of which customers’ funds form just a part thereof) and can be done more quickly and efficiently due to the power of the blockchain.
Luno is proud to be blazing the trail for safe online currency transactions and we believe that by working hand in hand with trusted associations and authorities, we can make cryptocurrency as safe and accessible as it can and should be.
You’re in safe hands.