Bybit CEO Claims MiCA License Alone is Insufficient for Profitability in Europe

Securing a Markets in Crypto Assets (MiCA) license is a crucial step for operating in Europe, but according to Bybit CEO Ben Zhou, it is not enough to guarantee profitability. Zhou emphasized that a MiCA license only permits fiat-to-crypto and crypto-to-crypto transactions, excluding other essential products like derivatives and tokenized assets that require a MiFID II license and an Electronic Money Institution (EMI) license. Even Bybit, the world's second-largest cryptocurrency exchange, is not expected to break even in Europe for at least two years, as it awaits the acquisition of necessary licenses. The current MiCA framework limits business potential, making it challenging for companies to turn a profit without multiple licenses. The impending market consolidation is expected to affect small to medium-sized crypto companies, as the MiCA grandfathering period is set to close, and firms must obtain MiCA authorization by July 1. Zhou predicts that this will lead to the shutdown of many smaller crypto firms, as they struggle to afford the necessary investments in compliance infrastructure. The MiCA regulations are also undergoing changes, with some regulators pushing for more centralized control and increased oversight. Bybit has chosen to work with Austria's FMA, a stringent regulator, which Zhou believes will have long-term benefits. The involvement of the European Securities and Markets Authority (ESMA) may lead to a more level playing field, but it also raises concerns about increased bureaucracy and decreased efficiency.