Bybit CEO: MiCA License Alone Insufficient for Profitability in Europe

Securing a Markets in Crypto Assets (MiCA) license is a crucial step for operating in Europe, but it is not enough to guarantee profitability, according to Bybit CEO Ben Zhou. In an interview, Zhou emphasized that the MiCA license has limitations, as it does not cover a wide range of products such as derivatives and tokenized assets, which are essential for generating significant revenue. To overcome these limitations, companies need to obtain additional licenses, including a MiFID II (Markets in Financial Instruments Directive) license and an Electronic Money Institution (EMI) license. Zhou explained that with the current MiCA framework, companies can only engage in fiat-to-crypto and crypto-to-crypto transactions, which restricts their ability to operate a profitable business. Even Bybit, the world's second-largest cryptocurrency exchange by trading volume, is not expected to break even in Europe for at least two years, as it awaits the acquisition of the necessary licenses. The CEO views this as a long-term investment, stating that the company can afford to wait due to its large size. The MiCA license allows crypto-asset service providers to operate across the European Economic Area (EEA), but the upcoming deadline for the MiCA grandfathering period is expected to lead to market consolidation, with smaller crypto firms likely to shut down due to the high costs of compliance and the need for additional licenses. Zhou noted that Bybit chose to register with Austria's FMA, a stringent regulator, which will pay off in the long run. The CEO also expressed neutrality regarding the potential involvement of the European Securities and Markets Authority (ESMA) in regulating the crypto industry, citing both potential benefits and drawbacks.