Global cryptocurrency exchange Bybit has officially relaunched its services in the United Kingdom after a two-year hiatus. The Dubai-based platform withdrew from the UK market in late 2023 in response to the Financial Conduct Authority's (FCA) implementation of stricter financial promotion rules.
The re-entry is not based on Bybit's own FCA registration but is being conducted under a promotions arrangement approved by Archax, an FCA-authorized digital asset exchange and brokerage firm. This partnership allows Bybit to operate in compliance with UK regulations by having Archax supervise its marketing and operational activities in the region.
The newly launched UK platform currently offers spot trading on approximately 100 cryptocurrency pairs and includes a peer-to-peer (P2P) trading venue. Notably absent are derivatives and higher-risk leveraged products, which have been excluded to align with the FCA's consumer protection focus. The platform emphasizes robust Anti-Money Laundering (AML) and Know Your Customer (KYC) checks and provides clear risk warnings to users about the potential loss of funds and the lack of protections from the Financial Services Compensation Scheme or the Financial Ombudsman Service.
Bybit's announcement cites an 8% crypto engagement rate in the UK, though this contrasts with recent FCA consumer research indicating ownership has fallen to 8% from a previous 12%. The exchange states that future products for UK users will be "tailored" to the market while remaining within the regulatory framework.
This "compliance-through-partnership" model, where a global platform leverages the license of a local regulated entity, is seen as a potential blueprint for other exchanges seeking market access in stringent jurisdictions. Archax has previously facilitated similar arrangements for other major exchanges like Coinbase and OKX.
Key questions remain unanswered, including the specific contractual entity for UK customers, the practical mechanics of the Archax oversight, and the protocols for handling events like hacks or insolvency.
