Bybit CEO: MiCA License Alone Insufficient for Profitability in Europe

Securing a Markets in Crypto Assets license is a crucial step for operating in Europe, but according to Bybit CEO Ben Zhou, it is not enough to guarantee profitability. In an interview, Zhou emphasized that the MiCA license has limitations, as it does not cover the full range of products necessary for a company to be profitable, such as derivatives and tokenized assets. To offer these products, companies need to obtain a MiFID II license and an Electronic Money Institution license. Zhou explained that even with a MiCA license, companies can only facilitate fiat-to-crypto and crypto-to-crypto transactions, which is not sufficient for a profitable business. Bybit, the world's second-largest cryptocurrency exchange by trading volume, is still at least two years away from breaking even in Europe, depending on when it acquires the necessary licenses. Zhou views the MiCA license as a long-term investment, stating that the company can afford it due to its size. The CEO predicts market consolidation, as smaller crypto companies may struggle to obtain the required licenses and comply with regulations. The MiCA grandfathering period is set to end in June, and companies must obtain MiCA authorization to operate across the region by July 1. Zhou believes that this deadline will lead to the closure of many smaller crypto firms. The regulatory environment is also evolving, with some country regulators calling for tighter control and increased oversight. Bybit has chosen to work with Austria's FMA, a stringent regulator, which Zhou believes will pay off in the long run. Regarding the potential involvement of the European Securities and Markets Authority, Zhou remains neutral, citing both potential advantages and disadvantages.