Hong Kong’s Securities and Futures Commission (SFC) recently issued a public warning about Bybit, adding it to the list of suspicious virtual asset trading platforms due to its unlicensed operations. The SFC expressed concerns that Bybit has offered its products to Hong Kong investors without securing the required license to conduct regulated activities in the region. This warning encompasses various products offered by Bybit, including futures contracts, inverse futures contracts, options, leveraged tokens, liquidity mining, staking, lending, wealth management, Bybit Dual Asset, and Bybit Shark Fin.
The SFC highlighted the potential risks associated with unlicensed crypto-related products in Hong Kong. Offering futures contracts and services without authorization is considered a criminal offense in the region. The SFC emphasized that it will not hesitate to take enforcement action against entities engaging in unlicensed activities, including Bybit, if deemed necessary. Additionally, promoting unlicensed products without authorization is also illegal in Hong Kong.
Individuals in Hong Kong who rely on unlicensed services, such as those offered by Bybit, face the risk of losing their investments if the platform ceases operations, collapses, or misappropriates user assets. Seeking recourse against such services can be challenging, especially if they do not have ties to Hong Kong. The possibility of SFC enforcement actions may provide some level of protection, but investors should exercise caution when engaging with unlicensed platforms like Bybit.
Bybit is recognized as the third-largest centralized crypto exchange globally, with a significant trading volume exceeding $7 billion as of March 14. While the platform’s popularity and offerings may be appealing to investors, the lack of necessary licensing from the SFC raises concerns about the legality and regulatory compliance of Bybit’s operations in Hong Kong. The inclusion of Bybit’s products on the SFC’s list of suspicious investment products underscores the regulatory scrutiny facing the platform.
Overall, the SFC’s warning against Bybit’s unlicensed operations serves as a reminder to investors about the importance of conducting due diligence before engaging with virtual asset trading platforms. Compliance with regulatory requirements and licensing obligations is crucial for the protection of investors and the integrity of the financial market in Hong Kong.