Bybit, one of the world’s largest crypto exchange operators, anticipates withdrawing from the United Kingdom in anticipation of forthcoming marketing regulations. These new rules, scheduled to take effect in the coming weeks, are poised to impose more stringent requirements on crypto-related marketing practices. Ben Zhou, co-founder and CEO of Bybit, commented: “We do see regulation becoming more strict.”
Zhou said that Bybit will have to scale back its operations in many countries. He believes that Bybit has to exit the UK very soon, and they recently concluded their operations in France. The UK Financial Conduct Authority (FCA) is set to enforce these new rules on October 8, designed to enhance transparency and accuracy in the marketing of cryptocurrency products. These regulations include the introduction of a cooling-off period for first-time investors.
Zhou highlighted that these regulations will bring about significant changes in the way solicitation is conducted. Despite the ban on crypto derivative products in the UK since 2021, some exchanges have continued to serve UK customers through reverse solicitation. However, the situation is expected to change drastically on October 8.”
FCA has directly reached out to all major players, including OKX, Binance, and others, inquiring about their plans to comply with this new law. According to the new law, if you use the English language, it will interpreted as an attempt to solicit their users, eliminating the option of claiming reverse solicitation, explained Zhou. “This has put everyone in a difficult position, and everyone is formulating strategies to navigate this new legal landscape,” he suggested.
George Morris, a partner at Simmons & Simmons, noted that while promotion regulations have been in place for securities firms for decades, they are now expanding to encompass crypto firms. He described these rules as intricate and wide-ranging, adding that even having a website accessible to UK customers could be construed as promotion starting from October 8. He emphasized that these requirements apply not only to UK-based firms but also to any entity with a website accessible to UK users.