South African Exchanges Set New Crypto Withdrawal Limits — Limits “Deterrence for Illegal Actors”

Transfers from Luno to Binance blocked

However, despite this admission, Luno has so far refused to explain how the exchange sets its so-called “risk-based dynamic limits.” According to a report, these limits are separate from the sending limits displayed on Luno’s website and were discovered by one of the exchange’s customers. The discovery became apparent to the customer when an attempt to transfer crypto assets from a Luno account to a Binance wallet failed.

When pressed for answers, Luno explained to customers that the restrictions were imposed “to protect our customers and in an effort to comply with anti-financial crime and anti-fraud best practices.”

Additionally, the exchange told customers that “limits are dynamic in nature and are calculated based on our overall customer risk score and limits may vary by customer.” However, Luno told affected customers that the exchange “did not disclose how [the] sending limits are calculated at an individual level.”

Luno customers cannot influence their risk score

Meanwhile, the report quotes Luno Africa General Manager Marius Reitz as explaining why and how the broader concept of a risk-based approach is used to determine limits for each client. He said:

As part of the wider concept of a risk-based approach mentioned, for example in the Financial Intelligence Centre Act (FICA), customer risk profiles are designed and scored based on a number of different data points.

Reitz added that while customers can’t influence their risk scores, they can still “optimize their risk profile by keeping their account information up to date, enabling account security features, and ensuring their accounts are secure.”

When asked about speculation that the exchange began implementing these dynamic risk-based limits at the request of the Financial Supervisory Authority (Finsurv), Reitz denied this. Instead, the general manager asserted that Luno did so because the exchange “is very careful to keep our financial crime measures as confidential as possible to ensure they remain effective.”