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 Bybit's CEO, Ben Zhou, emphasizes that 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 necessary for a company to be profitable, such as derivatives and tokenized assets. To offer these products, companies require a MiFID II license and an Electronic Money Institution (EMI) license. Zhou notes 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 also facing challenges in breaking even in Europe and is at least two years away from doing so. The timeline depends on when the firm acquires the necessary licenses. Market consolidation is expected, particularly with the MiCA grandfathering period ending in June, which will likely lead to the closure of many smaller crypto firms. Zhou believes that Bybit's decision to choose a stringent regulator in Austria's FMA will pay off in the long run, despite the varying levels of strictness in different countries' interpretations of MiCA. Regarding the potential involvement of the European Securities and Markets Authority (ESMA), Zhou remains neutral, citing both the potential benefits of a level playing field and the drawbacks of increased bureaucracy.