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. In an interview, Zhou highlighted that 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 generating revenue. To overcome this, companies need to obtain additional licenses, including a MiFID II (Markets in Financial Instruments Directive) license and an Electronic Money Institution (EMI) license. According to Zhou, even with a MiCA license, a company can only facilitate fiat-to-crypto and crypto-to-crypto transactions, which is insufficient for a profitable business model. Bybit, the world's second-largest cryptocurrency exchange by trading volume, is still far from breaking even in Europe and is relying on its size to absorb the costs. Zhou predicts that market consolidation is imminent, particularly with the MiCA grandfathering period coming to an end, which will likely lead to the closure of many small to medium-sized crypto companies. The CEO also discussed the potential changes to the MiCA framework, including the possibility of increased oversight by the European Securities and Markets Authority (ESMA), and the varying levels of strictness in regulation across different countries.