Bybit CEO: MiCA License 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 current MiCA framework has limitations, as it only allows for fiat-to-crypto and crypto-to-crypto transactions, excluding other essential products like derivatives and tokenized assets. To access these products, companies need to obtain a MiFID II license and an Electronic Money Institution license. Even Bybit, the second-largest cryptocurrency exchange, is at least two years away from breaking even in Europe. The company's profitability timeline is dependent on acquiring the necessary licenses. Zhou notes that the MiCA license is a long-term investment for Bybit, but smaller companies may struggle to afford the compliance infrastructure required to operate profitably. The impending closure of the MiCA grandfathering period is expected to lead to market consolidation, with many small to medium-sized crypto companies shutting down due to the inability to afford the required licenses and compliance infrastructure. The regulatory landscape is also evolving, with some country regulators pushing for stricter 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. The company remains neutral on the potential involvement of the European Securities and Markets Authority in regulating the crypto market.