Bybit CEO: MiCA License Alone Insufficient for Profitability in Europe

Securing a Markets in Crypto Assets license is a crucial step for operating in Europe, but it does not guarantee profitability, according to Bybit CEO Ben Zhou. In an interview, Zhou emphasized that the MiCA license has limitations, as it only covers a portion of the products needed to generate significant revenue, such as derivatives and tokenized assets. To overcome these limitations, companies must also acquire a MiFID II license and an Electronic Money Institution license. Zhou noted that even with a MiCA license, companies like Bybit are restricted to fiat-to-crypto and crypto-to-crypto transactions, excluding other essential elements of a profitable business. As a result, Bybit is at least two years away from breaking even in Europe, depending on when the company obtains the necessary licenses. The CEO views the current MiCA license as a long-term investment, acknowledging that the company can afford it due to its size. Market consolidation is expected, 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 predicted that this consolidation will occur because smaller firms may not be able to afford the necessary investments in compliance infrastructure to remain profitable. The MiCA framework is 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 pay off in the long run. He expressed neutrality regarding the potential involvement of the European Securities and Markets Authority, citing both the benefits of a level playing field and the potential drawbacks of increased bureaucracy.