Bybit CEO Claims 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 is not enough to guarantee profitability, according to Bybit CEO Ben Zhou. 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 significant revenue. To overcome this, companies need to obtain additional licenses, including MiFID II and Electronic Money Institution licenses. Zhou explained that with the current MiCA framework, companies can only engage in fiat-to-crypto and crypto-to-crypto transactions, which restricts their ability to operate a profitable business. Even large entities like Bybit, which is the world's second-largest cryptocurrency exchange by trading volume, are not yet profitable in Europe and are still in the process of acquiring the necessary licenses. Zhou predicts that it may take around two years for Bybit to break even in Europe. The CEO also anticipates market consolidation, as smaller crypto companies may struggle to comply with the regulatory requirements and obtain the necessary licenses. The MiCA grandfathering period is set to end in June, and companies must obtain authorization to operate across the region by July 1. Zhou believes that this deadline will lead to the closure of many smaller crypto firms. The regulatory landscape is continuously evolving, with some country regulators 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 the regulatory process.