Bybit CEO Claims MiCA License Alone Insufficient for Profitability in Europe

Obtaining a Markets in Crypto Assets 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 noted 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 acquire additional licenses, including a MiFID II license and an Electronic Money Institution license. Zhou explained that with the current MiCA framework, companies can only engage in 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, depending on when the company acquires the necessary licenses. The CEO views this as a long-term investment, stating that the company can afford it due to its size. Market consolidation is anticipated, 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. Zhou believes that the need for additional licenses and compliance infrastructure will be a significant barrier for these companies, resulting in market consolidation. The MiCA regulations are also undergoing changes, with some regulators pushing for more centralized control and increased oversight. Bybit has chosen to work with a stringent regulator in Austria, 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.