Bybit's Strategic Regulatory Moves in Europe and the Investment Implications for Crypto Derivatives

The European crypto derivatives market is undergoing a seismic shift, driven by regulatory clarity and institutional demand. At the forefront of this transformation is Bybit EU Group, whose aggressive pursuit of a MiFID II license through its Austrian subsidiary, Bybit X GmbH, signals a pivotal moment in the maturation of institutional-grade crypto markets. Bybit’s regulatory-first approach—culminating in a MiCAR license for spot trading in May 2025 and now a MiFID II application—positions the exchange to unlock a $70 billion derivatives market across the European Economic Area (EEA) [1]. This analysis examines how Bybit’s compliance strategy aligns with broader institutional adoption trends and quantifies the potential market impact of its licensing success.

Regulatory Foundations: MiFID II and MiCAR as Catalysts

The Markets in Financial Instruments Directive II (MiFID II) and the Markets in Crypto-Assets Regulation (MiCA) form the twin pillars of Europe’s regulatory framework for financial instruments and crypto assets. MiFID II, which governs derivatives, requires firms to adhere to strict investor protection and market integrity standards, while MiCA—fully applicable since December 2024—provides a harmonized framework for crypto-asset services [3]. Together, these regulations have created a “safe harbor” for institutional investors, who now treat crypto derivatives as legitimate tools for risk management and capital efficiency.

Bybit’s acquisition of a MiCAR license in May 2025 allowed it to offer regulated spot trading in Europe, but the MiFID II license represents a quantum leap. As stated by Bybit EU’s Managing Director, Mazurka Zheng, the company aims to “operate under strict investor protection and market integrity frameworks,” a stance that resonates with institutional clients wary of unregulated markets [5]. The MiFID II license would enable Bybit to offer futures, options, and potentially equity derivatives to EEA clients, bridging the gap between traditional finance and crypto markets [6].

Institutional Adoption: From Niche to Mainstream

Institutional participation in crypto derivatives has surged since 2024, with Europe emerging as a key hub. According to a report by CoinGlass, global Bitcoin derivatives open interest (OI) surpassed $70 billion in May 2025, driven by institutional inflows into spot ETFs and hedging strategies [4]. MiFID II compliance has been a critical enabler, as it ensures transparency, best execution, and systematic surveillance—factors that institutional investors prioritize.

Bybit’s MiFID II application aligns with this trend. Competitors like Gemini and OKX have already leveraged MiFID II licenses to expand their offerings, with Gemini introducing perpetual futures and OKX targeting institutional clients in the Euro Area [2]. Bybit’s entry into this space could accelerate market consolidation, as its existing MiCAR-compliant platform (bybit.eu) already supports features like spot margin trading and USDC adoption [1]. The exchange’s Business-to-Business Unit (BBU), which provides custody and tokenized products, further underscores its institutional focus [6].

Market Growth Projections and Bybit’s Potential Contribution

The EU crypto derivatives market is projected to grow at a compound annual growth rate (CAGR) of 7.82% from 2025 to 2030, reaching $16.98 billion by 2030 [2]. This growth is fueled by MiFID II and MiCA compliance, which have attracted institutional capital. For instance, regulated XRP/EUR perpetual futures launched in Q3 2025 saw nearly €2 billion in total positions, demonstrating demand for euro-based derivatives [3].

Bybit’s potential market share is significant. As of mid-2025, the exchange held 8% of global spot trading volume, with $14 billion in client assets [5]. If the MiFID II license is granted, Bybit could capture a material portion of the derivatives market, particularly as it expands into equity derivatives and introduces advanced risk management tools. A visual analysis of market share projections suggests that Bybit’s regulated derivatives offerings could drive a 15–20% increase in institutional trading volumes within the EEA by Q4 2025 [4].

Risks and Considerations

While Bybit’s regulatory strategy is ambitious, challenges remain. The MiFID II application process is rigorous, requiring compliance with Austria’s Securities Supervision Act and ESMA’s technical advice on market abuse regulation [3]. Additionally, competition from established players like OKX and Gemini could limit Bybit’s market capture. However, Bybit’s first-mover advantage in MiCAR compliance and its focus on institutional-grade infrastructure mitigate these risks.

Conclusion

Bybit’s pursuit of a MiFID II license is not merely a regulatory checkbox—it is a strategic move to position the exchange as a cornerstone of institutional crypto adoption in Europe. By aligning with MiFID II and MiCA frameworks, Bybit is addressing the core concerns of institutional investors: transparency, security, and compliance. As the EU derivatives market expands, Bybit’s ability to offer a full suite of regulated products—from spot trading to equity derivatives—could redefine the competitive landscape. For investors, this represents a compelling opportunity to capitalize on the convergence of regulatory innovation and institutional demand.

Source:
[1] Bybit EU Group Sets Sights on MiFID II License to Unlock Derivatives Market Across Europe [https://www.newswire.ca/news-releases/bybit-eu-group-sets-sights-on-mifid-ii-license-to-unlock-derivatives-market-across-europe-803809843.html]
[2] OKX acquires MiFID II license in Europe, prepares to offer ... [https://www.mitrade.com/insights/news/live-news/article-3-693352-20250313]
[3] Unlocking crypto derivatives: Europe's moment for digital asset growth [https://blog.kraken.com/news/industry-news/europe-crypto-derivatives]
[4] CoinGlass Crypto Derivatives Outlook-2025 Semi annual [https://www.coinglass.com/learn/semi-annual-outlook-en]
[5] 10 Best Crypto Exchange Or Apps in 2025 [https://investinghaven.com/crypto-blockchain/coins/best-crypto-exchange/]
[6] Bybit Establishes New B2B Unit to Drive Institutional Adoption of Digital Assets [https://usethebitcoin.com/crypto-live-feed/bybit-establishes-new-b2b-unit-to-drive-institutional-adoption-of-digital-assets/]