Bybit's Strategic Re-Entry into India: A Catalyst for Long-Term Crypto Growth and Investor Opportunities

India’s cryptocurrency market is at a pivotal inflection point, driven by regulatory clarity, institutional interest, and a surge in retail adoption. Bybit’s strategic re-entry into the country in 2025, marked by regulatory alignment and aggressive market engagement, underscores the growing significance of India as a global crypto hub. For investors, this development represents both a validation of India’s long-term potential and a case study in how compliance and community-building can catalyze sustainable growth in a high-stakes, high-regulation environment.

Regulatory Alignment: A Prerequisite for Sustained Growth

Bybit’s return to India in early 2025 was not a mere operational resumption but a calculated move to align with the country’s evolving regulatory framework. The exchange registered as a reporting entity under the Prevention of Money Laundering Act (PMLA) with the Financial Intelligence Unit-India (FIU-IND) in January 2025, a critical step toward legitimizing its operations [1]. This compliance milestone followed months of collaboration with regulators and a temporary suspension of services to finalize its Virtual Digital Asset Service Provider (VDASP) registration [3].

India’s regulatory landscape has long been a double-edged sword for crypto firms. While the absence of a clear legal framework previously deterred institutional participation, recent developments—including the Securities and Exchange Board of India’s (SEBI) proposed multi-regulatory oversight model—signal a shift toward structured governance [6]. Bybit’s proactive approach to compliance not only mitigates legal risks but also sets a precedent for other global exchanges seeking to enter the Indian market. As Vikas Gupta, Bybit India’s Country Manager, noted, the company’s vision extends beyond trading to fostering a “compliant and inclusive crypto ecosystem” through education and partnerships [4].

Market Engagement: Beyond Compliance to Community Building

Regulatory alignment alone is insufficient to capture India’s crypto potential. Bybit’s re-entry strategy includes grassroots initiatives to deepen market penetration. The exchange sponsored the India Blockchain Tour 2025, a nationwide event series aimed at educating developers, investors, and regulators about blockchain’s transformative applications [1]. Such efforts align with India’s broader digital transformation, where over 100 million crypto users and a young, tech-savvy population represent a fertile ground for innovation [2].

Additionally, Bybit’s World Series of Trading (WSOT) 2025, featuring welcome bonuses and high-value rewards, targets retail adoption by lowering entry barriers [4]. These campaigns are not merely promotional but strategic: they create a feedback loop of user engagement and data collection, which can inform future product development. For instance, Bybit’s reintroduction of advanced trading tools like Options and Copy Trading in India reflects a tailored approach to meet local demand [1].

India’s Crypto Market: A $15 Billion Opportunity by 2035

The broader context of Bybit’s re-entry is India’s explosive crypto market growth. According to IMARC Group, the market size is projected to grow from $2.6 billion in 2024 to $13.9 billion by 2033 at a CAGR of 18.48% [6]. This trajectory is fueled by factors such as increased digital literacy, blockchain-based financial infrastructure, and the rise of decentralized finance (DeFi) platforms [6].

Institutional participation is also accelerating. The introduction of crypto-specific start-ups and innovation hubs in cities like Mumbai and Bangalore is attracting venture capital and fostering a competitive ecosystem [6]. Meanwhile, tokenization of real estate and government bonds is unlocking liquidity for high-value assets, further broadening the appeal of crypto beyond speculative trading [4].

For Bybit, India represents a $2.5 billion opportunity in 2025, with potential to scale to $15 billion by 2035 [2]. This growth is not without challenges, however. India’s 30% flat tax on crypto gains and 1% tax deducted at source (TDS) on transactions remain hurdles for retail investors [2]. Regulatory gridlock, particularly around stablecoins, also poses risks to Web3 adoption [6]. Yet, Bybit’s compliance-first approach and community-driven initiatives position it to navigate these complexities more effectively than competitors.

Risks and Resilience: Lessons from Bybit’s Security Breach

Bybit’s re-entry was not without turbulence. In February 2025, the exchange suffered a $1.4 billion hack attributed to the North Korea-linked Lazarus Group, exposing vulnerabilities in third-party tools like Safe Wallet [5]. While this incident temporarily delayed its India re-entry, Bybit’s response—system overhauls, third-party audits, and a $100 million bounty for recovering stolen funds—demonstrated resilience [5]. CEO Ben Zhou emphasized transparency in the aftermath, framing the breach as a catalyst for industry-wide security improvements [5].

This episode highlights a critical lesson for investors: regulatory compliance and technological robustness are equally vital in the crypto space. Bybit’s ability to recover and resume operations in India underscores its commitment to long-term stability, even as it grapples with the inherent risks of a nascent industry.

Conclusion: A Model for Global Crypto Expansion

Bybit’s re-entry into India is more than a regional play—it is a blueprint for how global crypto firms can thrive in highly regulated markets. By prioritizing compliance, community engagement, and technological resilience, Bybit has positioned itself to capitalize on India’s $13.9 billion crypto market by 2033 [6]. For investors, this signals confidence in India’s digital asset future and the exchange’s ability to adapt to regulatory and operational challenges.

However, the path forward remains complex. Regulatory clarity, while improving, is still a work in progress. Investors must weigh Bybit’s strategic advantages against macroeconomic risks, such as India’s tax policies and global crypto market volatility. Yet, for those with a long-term horizon, Bybit’s India strategy offers a compelling case study in how innovation and compliance can coexist to drive sustainable growth.

Source:
[1] Bybit Restores Indian Users Full Access, Enhances Compliance and Crypto Inclusion [https://financefeeds.com/bybit-restores-indian-users-full-access-enhances-compliance-and-crypto-inclusion/]
[2] Deep Dive Decoding Crypto Investing in India [https://hdfc-tru.com/resources/primer/primer-listing/deep-dive-decoding-crypto-investing-in-india-opportunity-or-mirage/]
[3] Bybit Reenters Indian Market Following $1M Fine and [https://coinlaw.io/bybit-returns-india-crypto-regulations/]
[4] Blockchain Finance in India: Unlock New [https://mintbyte.com/uncategorized/blockchain-finance-india/]
[5] Bybit Returns to India After Compliance Hurdle and Major ..., [https://cryptorank.io/news/feed/7b8bb-bybit-returns-to-india-after-compliance-hurdle-and-major-hack]
[6] India Cryptocurrency Market Size, Share, Price Trends, 2033 [https://www.imarcgroup.com/india-cryptocurrency-market]