Bybit, one of the world’s largest cryptocurrency exchanges, expects to withdraw from the United Kingdom ahead of new marketing regulations expected in the coming weeks.
“We see stricter rules coming. We’ll likely have to exit many countries. I think we’ll have to exit the UK very soon. We’ve just left France recently,” explained Ben Zhou, co-founder and CEO of Bybit.
The Financial Conduct Authority, the regulator of the UK financial markets, will enforce new rules on October 8, including a cooling-off period for novice investors, in the hope of making the marketing of crypto products more transparent and accurate.
Zhou says the new rules will change the way customer acquisition works. While crypto derivative products have been banned in the UK since 2021, some exchanges have still managed to serve British customers and circumvent regulations. That could all change on October 8.
“The FCA has explicitly contacted all major players—us, OKX, Binance, everyone—and asked what our plan is to deal with this new law. And the new law is that if you use English as a language, they will consider you an attempt to solicit their users, so you cannot claim you are doing reverse solicitation,” Zhou says. “Everyone has issues. So everyone is thinking about plans to deal with this new law.”
For Bybit, the most likely outcome is simply severing ties with the United Kingdom, Zhou adds.
George Morris, a partner at Simmons & Simmons, says the promotion regime has been in place for securities firms for decades but has now been extended to the crypto sector.
“The rules are extraordinarily complex, and they’re quite wide,” Morris told The Block, adding that even having a website accessible to UK customers from October 8 could be considered promotion. “It’s not just UK firms that are subject to these rules. Anyone with a website that can be accessed in the UK falls under these requirements.”
Founded in 2018 as a derivatives-focused exchange, Bybit has expanded into a range of other products in recent years, including spot trading. However, its roots in derivatives remain strong. According to data from The Block Research, the company holds about 23% of the open interest in bitcoin futures today.
