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. 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 a company to be profitable. To offer these products, companies need to obtain additional licenses, including a MiFID II license and an Electronic Money Institution (EMI) license. Bybit, the world's second-largest cryptocurrency exchange by trading volume, is still far from breaking even in Europe and is relying on its large size to absorb the costs. The company's timeline for profitability depends on acquiring the necessary licenses. The current MiCA framework only allows for fiat-to-crypto and crypto-to-crypto transactions, limiting the potential for profitability. Market consolidation is expected, particularly with the MiCA grandfathering period ending soon, which will likely lead to the closure of many small to medium-sized crypto companies in Europe. The regulatory environment is also evolving, with some countries calling for stricter control and increased oversight. Bybit has chosen to work with a stringent regulator in Austria, which is expected to pay off in the long run. The company remains neutral on the potential involvement of the European Securities and Markets Authority (ESMA) in the regulatory process.