Bybit CEO Claims MiCA License Alone is Insufficient for Profitability in Europe

Obtaining a Markets in Crypto Assets license is a crucial step for operating in Europe, but it is not enough to guarantee profitability, according to Bybit CEO Ben Zhou. 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 revenue. To address this, companies require a MiFID II license and an Electronic Money Institution license. Zhou explained that with the current MiCA framework, companies can only facilitate fiat-to-crypto and crypto-to-crypto transactions, which is not enough to sustain a profitable business. Even Bybit, the world's second-largest cryptocurrency exchange, is not expected to break even in Europe for at least two years, as it awaits the acquisition of necessary licenses. The CEO views this as a long-term investment, acknowledging that market consolidation is imminent, particularly with the MiCA grandfathering period coming to a close. This period's end is expected to lead to the demise of many smaller crypto firms, as they will be required to obtain MiCA authorization to operate across the region. Zhou noted that some country regulators are pushing for stricter control, which may lead to increased oversight by bodies like the European Securities and Markets Authority. Bybit has chosen to work with Austria's FMA, a stringent regulator, which Zhou believes will yield benefits in the long run. The CEO remains neutral about the potential involvement of ESMA, citing both advantages and disadvantages to a more centralized regulatory approach.