Bybit Ceases UK Operations in Response to FCA's New Rules

Bybit, a well-known cryptocurrency exchange, has announced the suspension of its services for users in the United Kingdom in reaction to anticipated Financial Conduct Authority (FCA) rules. This judgment comes as the FCA implements stronger regulations and guidelines aimed at regulating the UK cryptocurrency business. and rules intended to regulate the cryptocurrency business in the United Kingdom.

Effective October 1, Bybit will halt the acceptance of new account applications from UK residents. Subsequently, on October 8, the exchange will suspend new deposits, new contract creation, and changes to positions for its existing UK user base.

For UK-based customers of Bybit, it's crucial to take prompt action in response to these changes. By January 8, 2024, at 8 AM UTC, users are advised to manage and close their positions. Any open positions left after this deadline will be liquidated, and the resulting funds will be available for withdrawal.

Bybit, headquartered in Dubai, has taken this proactive step to comply with the new rules introduced by the FCA, particularly focusing on the regulations regarding marketing and communications by crypto businesses. These regulations were detailed in the June 2023 Policy Statement titled “Financial Promotion Rules for Crypto assets” (PS23/6). Bybit's decision to suspend its UK services temporarily reflects its commitment to align with these regulations.

The move follows Bybit's earlier statement that it was actively exploring options to continue its operations in the UK while adapting to the impending changes in financial promotion rules. The exchange's CEO, Ben Zhou, mentioned ongoing discussions with regulators to find the most suitable approach moving forward.

The new regulations set by the FCA will impact cryptocurrency companies, compelling them to be registered or authorized by the Financial Conduct Authority when engaging with UK clients. Several other firms, including Luno and PayPal, have already made adjustments to their crypto operations in anticipation of these changes.

Back in June, the UK introduced new advertising rules aimed at companies marketing crypto assets to consumers. These changes are motivated by concerns over investor protection. The FCA has recommended that customers take time to educate themselves about the associated risks before investing.

Among the key provisions of the new rules is the introduction of a 24-hour “cooling-off” period, specifically designed for first-time investors. This pause allows new investors to reconsider their decisions before proceeding with potentially high-risk investments. Additionally, the practice of offering “refer a friend” bonuses will be prohibited.

Furthermore, the new regulations necessitate that firms promoting crypto products or services include a clear risk warning in their promotions and verify that individuals possess the necessary knowledge and experience to invest in cryptocurrencies.

As Bybit temporarily exits the UK market, it reflects the broader impact of regulatory changes on the cryptocurrency industry. Market participants are adjusting their operations to adhere to evolving rules, with a focus on investor protection and compliance with local regulatory bodies. Stay informed about the latest developments in the crypto world to make informed decisions in this rapidly changing landscape.