The regulation of cryptocurrencies is a sensitive issue for many crypto businesses, as it can greatly impact their operations within a given country. In recent years, numerous crypto companies have left the United States due to regulatory concerns. Similarly, Bybit may also be considering a move away from the United Kingdom due to similar reasons.
Bybit UK is not facing a direct ban but instead has made a voluntary decision to withdraw from the country due to regulatory concerns. The United Kingdom is introducing new laws for crypto companies, and Bybit has expressed discomfort with operating in the country under these laws. As a result, they have decided to leave.
Lately, the United Kingdom has been hitting down hard on the crypto sector. Aside from new regulations and p[policies, the UK has even mandated a new agency to investigate crypto-related crimes.
Ben Zhou, co-founder and CEO of Bybit, was the one who gave some explanation of why the crypto exchange will be leaving the UK. Apparently, the UK will stop being in Bybit available countries due to the stricter rules the government is making regarding the crypto industry. He mentioned that similar issues forced the crypto exchange to leave France, and the same thing might happen in the UK.
"We do see regulation becoming more strict. Most likely, we’ll have to retreat in many countries. I think the UK — we’ll have to exit very soon. We recently exited France," he said.
New Rules Force Bybit Out of the UK
It seems that Bybit will be compelled to exit the UK owing to a new regulation developed by the Financial Conduct Authority (FCA). The FCA has formulated this regulation, which will go into effect on October 8th of this year. The FCA's objective with this new rule is to safeguard customers and investors from high-risk trading assets, such as the crypto industry.
Lucy Castledine, Director of Consumer Investments, said if companies in the UK don't risk a ban, fine, or suspension, they should ensure they treat their customers more transparently and fairly. Already, firms are given from now till 8 January 2024 to implement some of the specified features on their services. But the core rules will kick off from 8th September.
"From this October, crypto firms must market to UK consumers clearly, fairly, and honestly. And they must provide risk warnings people understand. As a proportionate regulator, we’re giving firms that apply a little more time to get the other reforms requiring technology and business change right. We'll maintain our close eye on firms during this extended implementation period. We are concerned by the failure of many overseas and unregulated crypto firms to engage with us on the new rules. Come 8 October, we will be taking action against firms illegally marketing to UK consumers," Lucy Castledine said.
Zhou, in response, says the new rule will change many things in terms of soliciting. Although the trade of derivatives was banned in the UK in 2021, crypto firms had used reverse soliciting to attract customers. This will change with the new law.
"FCA has explicitly contacted all the 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 see you as trying to solicit their users, so you cannot claim that you are in reverse solicitation," Zhou said.