Bybit CEO Claims MiCA License Alone Insufficient for Profitability in Europe

Acquiring a Markets in Crypto Assets license is a crucial step for operating in Europe, but Bybit's CEO, Ben Zhou, believes it is not enough to guarantee profitability. According to Zhou, the MiCA license has limitations, as it does not cover the full range of products required 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 with the current MiCA framework, companies can only facilitate fiat-to-crypto and crypto-to-crypto transactions, which is not sufficient for 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 the MiCA license as a long-term investment, acknowledging that the company can afford it due to its size. The market is expected to undergo consolidation, particularly with the MiCA grandfathering period ending in June, which will likely lead to the closure of many small to medium-sized crypto companies. Zhou noted that some country regulators are pushing for stricter control and increased oversight, which may impact the profitability of crypto firms. Bybit has chosen to work with Austria's FMA, a stringent regulator, which Zhou believes will pay off in the long run. The company remains neutral on the potential involvement of the European Securities and Markets Authority in the regulatory process.