Bybit CEO: MiCA License Alone Insufficient for Profitability in Europe

Acquiring a Markets in Crypto Assets (MiCA) 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 MiCA framework has limitations, as it does not cover the full spectrum of products necessary for a company to be profitable, such as derivatives and tokenized assets. To offer these products, companies require additional licenses, including a MiFID II (Markets in Financial Instruments Directive) license and an Electronic Money Institution (EMI) license. Zhou emphasized that even with a MiCA license, companies like Bybit are restricted to fiat-to-crypto and crypto-to-crypto transactions, limiting their ability to generate revenue. As a result, Bybit is still some way off from breaking even in Europe, with a projected timeline of around two years, contingent on acquiring the necessary licenses. The current market landscape is poised for consolidation, particularly with the impending closure of the MiCA grandfathering period, which will likely lead to the exit of smaller crypto firms. Zhou noted that the regulatory environment is 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 yield long-term benefits. The potential involvement of the European Securities and Markets Authority (ESMA) in the regulatory process is viewed as neutral by Bybit, as it could bring about a more level playing field but also increased bureaucracy.