MiCA License Alone Insufficient for Profitability in Europe, Says Bybit CEO

Obtaining a Markets in Crypto Assets license is a crucial step for operating in Europe, but it is not enough on its own 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 acquire a MiFID II license and an Electronic Money Institution license in addition to MiCA. Zhou explained that even with a MiCA license, many elements of a profitable business cannot be implemented, making it essential to hold multiple licenses to succeed. Bybit, the world's second-largest cryptocurrency exchange by trading volume, is still some way off from breaking even in Europe, with a timeline dependent on acquiring the necessary licenses. The company views its MiCA license as a long-term investment, with profitability expected within two years. The crypto market in Europe is on the verge of consolidation, particularly with the MiCA grandfathering period ending soon, which will likely lead to the closure of many smaller crypto firms. Zhou noted that market consolidation is inevitable, with smaller companies struggling to afford the necessary investments in compliance infrastructure to operate profitably. The regulatory environment is also evolving, with some countries pushing for stricter 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 regulating the crypto market, citing both potential benefits and drawbacks.