Bybit CEO: MiCA License Alone Insufficient for Profitability in Europe

Acquiring a Markets in Crypto Assets (MiCA) license is a crucial step for operating in Europe, but it is not enough to guarantee profitability, according to Bybit CEO Ben Zhou. The current MiCA framework has limitations, as it does not cover the full range of products required for a company to be profitable, such as derivatives and tokenized assets. To offer these products, companies need to obtain a MiFID II license and an Electronic Money Institution (EMI) license. Zhou emphasized that even with a MiCA license, many elements of a profitable business cannot be achieved, making it essential for companies to acquire multiple licenses to succeed. Bybit, the world's second-largest cryptocurrency exchange by trading volume, is also facing challenges in breaking even in Europe and is investing in the long term. The company expects to become profitable within two years, depending on when it acquires the necessary licenses. The MiCA grandfathering period is coming to an end, and many small to medium-sized crypto companies are at risk of shutting down due to the high compliance costs and the need for additional licenses. Market consolidation is expected, with smaller firms struggling to afford the necessary investments in compliance infrastructure. The regulatory landscape is also evolving, with some country regulators calling for tighter 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 (ESMA) in the regulatory process.