Bybit faces regulatory heat for unlicensed Hong Kong operations


  • The Securities and Futures Commission (SFC) of Hong Kong issued a public warning against Bybit.
  • Bybit, known as the third-largest centralized crypto exchange globally, recorded a 24-hour trading volume of over $7 billion as of March 14.
  • The SFC’s warning specifically targets 11 Bybit products, including futures contracts, options, and leveraged tokens, labeling some as suspicious

The Securities and Futures Commission (SFC) of Hong Kong has recently issued a public warning. It concerns Bybit, a virtual asset trading platform. The SFC’s announcement, dated March 14, highlights that Bybit operates without the necessary licensing in the region. This move marks a significant step by the regulatory body to safeguard investors from potential risks associated with unlicensed financial activities.

Bybit, recognized as the third-largest centralized crypto exchange globally, boasts a substantial trading volume. Reports indicate that its 24-hour trading volume exceeded $7 billion as of March 14. Despite its global prominence, the SFC’s scrutiny underscores a rigorous stance on regulatory compliance within Hong Kong’s financial market.

Unlicensed Bybit activities prompt SFC warning

The warning issued by the SFC details that none of the Bybit group entities hold the required license for regulated activities in Hong Kong. This encompasses a range of products offered by Bybit, including futures contracts, options, leveraged tokens, and more. Specifically, the SFC’s concerns extend to 11 Bybit products, among them Bybit Dual Asset and Bybit Shark Fin, which the commission has labeled as suspicious.

Operating without a license in Hong Kong is a criminal offense, particularly when it involves crypto-related products and services. This includes futures contracts and services, as well as the promotion of such unlicensed products. The SFC’s warning not only highlights the illegal status of these operations but also hints at the potential financial risks for investors. Those relying on unlicensed platforms like Bybit might face challenges in seeking recourse should the service cease operations or engage in fraudulent activities.

Regulatory actions and investor protection

The SFC has not only flagged Bybit’s operations as suspicious but has also indicated the possibility of further regulatory actions. The commission has explicitly stated its readiness to enforce against unlicensed activities to protect investors. This stance reflects Hong Kong’s broader efforts to establish a secure and regulated financial market, especially concerning the burgeoning sector of virtual assets.

Investors are thus urged to exercise caution and prioritize engaging with licensed and regulated platforms. The SFC’s proactive measures, including public warnings and potential enforcement actions, aim to prevent financial losses and ensure a safer investment landscape. As the situation develops, the regulatory body remains vigilant in monitoring and addressing unlicensed financial activities within its jurisdiction.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decision.

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Mutuma Maxwell

Maxwell especially enjoys penning pieces about blockchain and cryptocurrency. He started his venture into blogging in 2020, later focusing on the world of cryptocurrencies. His life's work is to introduce the concept of decentralization to people worldwide.

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