Key Factors:
- Bybit’s VATP utility license in Hong Kong was withdrawn on Could 31 following SFC scrutiny.
- Hong Kong’s new rules led to seven exchanges exiting the licensing course of not too long ago amid rumors of no offshore licenses being issued quickly.
On Could 31, Bybit, one of many prime three cryptocurrency exchanges globally by buying and selling quantity with 30 million customers, withdrew its utility for a digital asset buying and selling platform (VATP) license from Hong Kong’s Securities and Futures Fee (SFC).
Bybit’s VATP Software License in HK Is Now Withdrawn With Authorized Challenges 2
Bybit’s VATP Software License Hong Kong Withdraws Amid Regulatory Strain
The withdrawal of Bybit’s VATP utility comes after the SFC beforehand issued warnings to buyers, labeling Bybit as an unregistered trade. In March, SFC additionally Bybit and MEXC to its warning record for selling buying and selling companies to Hong Kong residents with out correct licensing. The scrutiny follows related warnings issued by Japanese and German authorities final yr.
Established in 2018, Bybit is legendary for its ultra-fast matching engine, catering to skilled crypto buyers and merchants.
Below new rules, efficient June 2023, all VATP operators in Hong Kong have been required to use for an SFC license by February 29. These failing to conform have been mandated to stop native operations by Could 31. In mild of those rules, market rumors counsel that Hong Kong could not concern licenses to offshore exchanges within the close to future. Consequently, seven exchanges have exited the licensing course of inside the previous two months.
Regardless of the regulatory tightening, Hong Kong stays a vibrant hub for digital property. The current approval of spot Bitcoin and Ethereum ETFs underscores the nation’s progressive stance on buying and selling and know-how improvements. Nevertheless, the area’s shift away from serving as a proxy to China could influence its attractiveness to buyers.
Bybit Faces Inner Turmoil Over Notcoin Airdrop Mishap
Following Bybit’s VATP utility, the trade has additionally confronted inside challenges. A number of CEOs resigned following points with the Notcoin (NOT) airdrop, which pressured the trade to compensate 320,000 customers with $26 million.
The airdrop mishap occurred on Could 16 when customers skilled delays in depositing Notcoins, leading to losses as they have been unable to promote instantly. The trade processed 370,000 on-chain transactions, with 70% of deposits recorded earlier than NOT buying and selling pairs have been opened.
