Bybit Launches BYUSDT, Enabling VIP Users to Use Yield-Earning Assets as Trading Margin

Bybit, the world's second-largest cryptocurrency exchange by trading volume, has introduced a proprietary token called BYUSDT. This new product, developed entirely in-house, is available exclusively to VIP users and allows them to convert their USDT holdings from the Flexible Easy Earn program into trading margin while continuing to earn yield on those assets.

The BYUSDT token represents a 1-to-1 claim on a user's USDT held in Flexible Easy Earn and maintains a 100% collateral value ratio for margin trading within Bybit's Unified Trading Account. This structure is designed to solve the liquidity-versus-returns dilemma, enabling users to keep their yield-generating positions active while simultaneously deploying the same capital for trading.

Key operational details include a fixed 1-to-1 swap rate with USDT Flexible Earn positions, with no lock-up period and a constant conversion rate to prevent depegging. For a limited time after launch, Bybit is waiving minting and redemption fees, though a service fee may apply for swapping or redeeming BYUSDT on its dedicated page, including during yield conversion. Manual USDT repayments and liquidation settlements using BYUSDT incur no fees and convert back to USDT at the 1-to-1 rate.

The yield mechanism mirrors the annual percentage rate (APR) of the USDT Flexible Easy Earn product (excluding platform reward APR). Rewards accrue hourly based on effective BYUSDT holdings, with distributions occurring once daily around 12:30 a.m. UTC, paid directly in BYUSDT to the user's Unified Trading Account.

The product became available starting at 2 p.m. UTC on December 12, 2025. Furthermore, Bybit has announced a separate BYUSDT Trading Competition with a total prize pool of 700,000 USDT, scheduled to begin at 10 a.m. UTC on December 15. The competition will be governed by independent campaign rules, and only trading activity during the official period will count toward rewards.

It is important to note that BYUSDT may be unavailable or restricted in certain jurisdictions due to regulatory requirements.