MiCA's not enough: Bybit CEO says firms need other licenses to turn a profit in Europe

Bybit CEO Ben Zhou argues that cryptocurrency firms need additional licenses beyond MiCA to achieve profitability in Europe, highlighting the challenges of crypto regulation.

Are you aware that simply obtaining a MiCA license might not be enough for crypto firms to thrive in Europe? In a recent interview, Bybit CEO Ben Zhou emphasized that companies in the cryptocurrency space need more than just this license to realize profitability. Let’s delve into the specifics of Zhou's insights and the broader implications this has for the industry. What is the current state of crypto regulation in Europe? The Markets in Crypto Assets (MiCA) regulation has been positioned as a pivotal framework for cryptocurrency operations across Europe. However, Zhou pointed out that relying solely on a MiCA license can severely limit an exchange's operational capacity. “With the current MiCA framework, you can only do fiat-to-crypto, crypto-to-crypto,” Zhou said. This limited offering means that many essential and lucrative products—including derivatives and tokenized assets—cannot be offered unless companies also acquire additional licenses. What additional licenses do firms need? To effectively navigate the European market, cryptocurrency exchanges require a MiFID II (Markets in Financial Instruments Directive) license and an Electronic Money Institution (EMI) license on top of their MiCA authorization. These licenses enable firms to provide diversified products that can generate revenue. As Zhou succinctly noted, "There are many elements of a profitable business you cannot do," highlighting the constraints under the current conditions. How long until Bybit breaks even in Europe? Currently, the Bybit exchange is projected to be at least two years away from breaking even in the European market. "We don’t make money under the current MiCA license," Zhou admitted. The timeline to achieve profitability is intrinsically linked to when Bybit acquires the necessary additional licenses. "It could be five years away, but I think that is a bit long. I would assume we are probably going to be profitable within two years," he adds, underlining the expectation of a positiv