Bybit Nears Full UAE License After Overcoming $1.4 Billion Hack

Bybit has secured an in-principle approval (IPA) from the United Arab Emirates’ Securities & Commodities Authority (SCA) to establish itself as a Virtual Asset Platform Operator in the region.

The development marks a major step toward Bybit obtaining a full operational license.

Bybit to Establish Virtual Asset Platform in the UAE

This authorization moves Bybit closer to offering a broad range of digital asset services to retail and institutional clients in the UAE. It follows its existing regulatory approvals in the Middle East, further solidifying its commitment to compliance in key financial hubs.

Bybit’s co-founder and CEO, Ben Zhou, expressed optimism regarding the IPA and demonstrated optimism for full operational approval from the SCA in the statement. 

“We are honored to have received the IPA from SCA. This approval marks a crucial step in our journey to providing secure and transparent crypto trading solutions,” Zhou shared in the announcement.

Meanwhile, this development reflects the UAE’s ongoing efforts to position itself as a crypto and blockchain innovation leader. Bybit’s regulatory progress aligns with the UAE’s forward-thinking stance on digital assets, ensuring a compliant and secure retail and institutional investors trading environment.

Bybit’s expansion in the UAE follows a similar development in India earlier this month. The exchange successfully registered with India’s Financial Intelligence Unit (FIU). This allowed it to resume full operations after a temporary suspension due to compliance issues.

“Big News! Bybit is officially registered with the FIU-IND and making strides in the Indian market! We’re thrilled to expand our presence in India, and this registration marks a huge milestone,” the announcement read.

Reportedly, Bybit Exchange paid a $1.06 million fine for previously operating without proper registration. It has since aligned with Indian regulatory standards.

Notably, the company confirmed that all services for existing users in India will be restored as of February 25. Further, the onboarding of new users will resume gradually.

Despite its regulatory progress in the UAE and India, Bybit faces scrutiny in Japan. In February, Japan’s Financial Services Agency (FSA) urged major app stores to delist Bybit and other unregistered crypto exchanges.

The FSA cited concerns over unlicensed operations and potential risks to investors, reinforcing Japan’s stringent approach to crypto regulation.

Beyond regulatory developments, Bybit remains in the headlines after a significant security breach. As beInCrypto reported, over $1.4 billion was withdrawn from its platform. Investigations suggest North Korea’s Lazarus Group was responsible for the attack, further intensifying concerns about security vulnerabilities in centralized exchanges (CEXs).

Despite the breach, Bybit reassured users that all funds remained secure and fully backed. The exchange launched a crisis management strategy, offering a $140 million bounty to track down exploiters and recover stolen assets. However, subsequent reports indicate that Safe Wallets’ system was the weak link, not Bybit’s internal system.

The incident highlights the importance of understanding the risks of crypto wallet security, especially for firms handling large amounts of customer funds.