Bybit CEO: MiCA License Alone Insufficient for Profitability in Europe

Securing 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. In an interview, Zhou explained that 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 a company to be profitable. To offer these products, companies need to obtain a MiFID II license and an Electronic Money Institution (EMI) license. Zhou noted that even with a MiCA license, companies like Bybit are restricted to offering only fiat-to-crypto and crypto-to-crypto services, which is not enough to generate significant revenue. The CEO stated that Bybit, the world's second-largest cryptocurrency exchange by trading volume, is at least two years away from breaking even in Europe, and this timeline is dependent on acquiring the necessary licenses. Zhou believes that market consolidation is imminent, especially with the MiCA grandfathering period ending in June, which will force many small to medium-sized crypto companies to either obtain the necessary licenses or cease operations. He also mentioned that the MiCA framework is subject to change, with some 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. Regarding the potential involvement of the European Securities and Markets Authority (ESMA), Zhou expressed neutrality, citing both the benefits of a level playing field and the potential drawbacks of increased bureaucracy.