Bybit CEO Claims 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. The MiCA license has limitations, as it does not cover a wide range of products such as derivatives and tokenized assets, which are necessary for a company to be profitable. To offer these products, companies require a MiFID II license and an Electronic Money Institution (EMI) license. Zhou explained that with the current MiCA framework, companies can only facilitate fiat-to-crypto and crypto-to-crypto transactions, which is not sufficient for a profitable business. Even Bybit, the world's second-largest cryptocurrency exchange by trading volume, is not expected to break even in Europe for at least two years, depending on when the company acquires the necessary licenses. Zhou views the MiCA license as a long-term investment, stating that the company can afford it due to its size. The CEO predicts that market consolidation is imminent, 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. The MiCA license allows a crypto-asset service provider to operate across the European Economic Area (EEA), but the varying interpretations of MiCA by different countries may lead to inconsistencies. Zhou remains neutral on the potential involvement of the European Securities and Markets Authority (ESMA) in the regulation of crypto firms, citing both potential advantages and disadvantages.