Bybit CEO Claims 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. 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 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 sufficient for a profitable business. Even Bybit, the second-largest cryptocurrency exchange by trading volume, is not expected to break even in Europe for at least two years, depending on when the company acquires the necessary licenses. The timeline for profitability is contingent upon obtaining the required 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 that market consolidation is imminent, particularly with the MiCA grandfathering period ending in June, 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 advocating for stricter control and increased oversight. Bybit has chosen to work with a stringent regulator in Austria, which Zhou believes will ultimately benefit the company. The CEO remains neutral regarding the potential involvement of the European Securities and Markets Authority in the regulatory process.