Proof of Reserves
Full verification of customers' cryptocurrency
Luno has always gone the extra mile to keep customers safe, with industry-leading processes protecting all our customers’ assets.
You don’t need to just take our word for it though.
Luno is proud to be blazing a trail for safe cryptocurrency investment by having all the assets we store regularly verified by independent auditors Mazars, so you can be confident all the assets you hold with Luno are exactly where they should be.
So, what is it?
Mazars is a leading international audit, tax and advisory firm. They run a series of procedures every quarter to make sure that the Bitcoin, Ethereum and any other cryptocurrency you see in your Luno Wallet exists and is exactly where we say it is.
This report provides current and prospective customers with reassurance that their digital assets actually exist and that the funds are either situated on-chain or within a custody solution.
Why does this matter?
Proof of reserves reports bring a level of trust to an industry that some people believe lacks transparency. It plays a valuable role in creating a safer investment environment for all cryptocurrency customers and is an important step in achieving our mission of putting the power of crypto in everyone’s hands.
Marius Reitz, GM of Luno said: We take a stand against crypto crime and proof of reserves helps to protect all stakeholders. Luno’s ten million customers in more than 40 countries can rest assured that their wallets do in fact contain the crypto stated. We have always said that Luno is a safe platform to secure and store crypto and this is external validation that this is in fact the case.
Reports
We will publish all reports every quarter on this page below.
Frequently asked questions
We have always gone the extra mile to keep investments secure by using industry-leading processes and bank-grade security to protect customers’ cryptocurrency.
No one should just take our word for it though.
That’s why Luno is proud to be blazing the trail for safe online currency transactions by releasing its first full external verification of customer cryptocurrency
The report brings a level of trust to an industry perceived to be opaque and complex and will in turn boost the credibility of the industry.
This proof of reserve reports plays a valuable role in creating a safer investment environment for all cryptocurrency customers, bolstering the credibility of the industry and achieving our mission of putting the power of crypto in everyone’s hands.
The use of the word audit is strictly defined by the standards that govern auditors internationally to cover the financial statements prepared at year end by a legal entity.
Auditors review company systems, financial statements and accounting principles while checking the accuracy of the company's financial records. The auditor is responsible for issuing an opinion on whether or not the financial statements fairly present a company's results and financial position.
As the proof of reserves only covers Luno’s customer cryptocurrency, this cannot be defined as an audit and therefore the mechanism for verification is an agreed upon procedure.
To add to this the Luno group is audited annually with Mazars as our appointed group auditor.
Yes! The proof of reserves verification covers Luno’s customer cryptocurrency globally.
While Luno is audited annually, we felt that this was a long time for customers to wait to know if their funds were safe. Conversely the work required for the proof of reserves verification isn’t trivial and requires a significant amount of time investment from both Mazars and Luno. Quarterly therefore felt like the right balance and conforms to other credible players in the industry who also perform these verifications.
The Mazars’ report ensures that customers’ investments are ‘collateralised’.
Mazars conclude whether the nominal value of all cryptocurrencies as per the Asset Balance Reports are equal to or greater than the liability of funds owed to the customers as per the Customer Liability Report and therefore meets the definition of being collateralized.
This essentially means that they’ve checked that the Bitcoin, Ether and any other cryptocurrency you see in your Luno Wallet actually exists and belongs to you as the customer, so you can be sure that your cryptocurrency is always exactly where it should be.
Mazars perform their testing on a sample basis. This is for a few reasons mentioned below:
- The 90% covers the vast majority of the customers cryptocurrency while ensuring we are timeous in getting the report out after the quarter end. Testing the full 100% would be highly inefficient and extend the release of the report to where it is no longer as relevant.
- Further to this the Mazars report states the following “The self-custodied cryptocurrencies will be tested on a sample basis due to the UTXO principles that apply to cryptocurrencies such as BTC, BCH and LTC.” UTXO can be explained as an unspent transaction output and is the technical term for the amount of digital currency that remains after a cryptocurrency transaction has occurred. You can think of it as the change you receive after buying an item, but it is not a lower denomination of the currency—it is a transaction output in the database generated by the network to allow for non-exact change transactions. This sample basis avoids Mazars having to test thousands of addresses with very low amounts.
It should also be noted that all other cryptocurrencies are tested 100%.