Bybit's Regulatory Pressure in Singapore
Published 6/17/2026, 10:37:54 PM
Bybit is facing mounting regulatory pressure in Singapore primarily because its Singapore-incorporated entity (ByBit Fintech Pte Ltd) is not licensed by the Monetary Authority of Singapore (MAS) to provide digital payment token services, while simultaneously operating under a tightening regulatory framework designed to restrict Singapore-based firms from serving overseas customers.
Key Regulatory Actions
Investor Alert List (IAL) Addition
MAS added both "Bybit Fintech Limited" and "Bybit" to its Investor Alert List, signaling that Bybit is not licensed or regulated by MAS to provide digital payment token services in Singapore. This public warning indicates that customer funds held on the platform sit outside MAS protections. [Source: https://www.businesstimes.com.sg/bybit-not-licensed-mas]
FSMA Section 137 Directions
MAS directed that Singapore-incorporated firms providing digital token services to customers outside the country must cease those activities by June 30, 2026 — with no transitional window permitted. The order specifically targets companies whose front-office functions (sales, business development) sit in Singapore while customers sit abroad. [Source: https://www.mas.gov.sg/news/mas-issues-directions-to-singapore-incorporated-digital-token-service-providers]
MAS stated it is "unlikely to approve any application by an entity to provide DT services from Singapore to only overseas persons, given the higher inherent ML/TF risks and the limited supervisory oversight MAS can exercise over such entities." [Source: https://www.cointelegraph.com]
Why Bybit Cannot Easily Obtain a License
Since January 2020, MAS has received 176 applications for digital payment token licenses and rejected or seen withdrawn approximately 100 applications — a ~57% rejection rate. MAS has licensed significantly more than three entities, with at least 33 MAS-licensed digital payment token service providers currently operating. [Source: https://www.elliptic.co]
MAS cited persistent concerns about:
- Money laundering risks via cryptocurrency platforms
- Terrorism financing vulnerabilities
- Proliferation financing risks
- Challenges posed by transaction speed and cross-border nature of crypto assets
Bybit's Specific Situation
| Attribute | Details |
|---|---|
| Singapore Entity | ByBit Fintech Pte Ltd |
| Parent Ownership | ByBit (Seychellois company) |
| License Status | NOT licensed by MAS |
| Planned Response | Reorganizing teams; weighing moves to Dubai and Hong Kong |
Broader Context
The February 2025 hack — in which $1.46 billion was stolen by DPRK (Lazarus Group) actors, with only 3.8% recovered — increased global regulatory scrutiny on Bybit. France also required Bybit to stop withdrawal and custody services for French users starting January 8, 2025, citing increased regulatory requirements.
Second-Order Consequences
The IAL addition triggers practical business impacts:
- Banking relationships become strained (harder to maintain local banking rails)
- Marketing channels close
- Singapore-dollar transaction on-ramps thin out
- Payment processors grow cautious
This mirrors the 2021 Binance removal from Singapore, which quickly resulted in loss of local banking access, removal of currency pairs, and loss of marketing reach.
Enforcement Exposure
With the June 30, 2026 deadline approaching and the IAL listing now public, Bybit's options are narrowing. Non-compliance with FSMA can result in fines up to S$250,000 and imprisonment up to 3 years.
Conclusion: Bybit faces mounting pressure because Singapore's restrictive licensing regime under FSMA effectively makes it impossible to legally serve overseas customers from a Singapore base — and MAS is unlikely to grant licenses for such operations. Bybit is now weighing whether to exit the Singapore market or reorganize operations to jurisdictions like Dubai or Hong Kong.
Suggested next steps:
- Monitor MAS enforcement timeline — with the June 30, 2026 deadline approaching, track whether Bybit announces a formal exit or restructuring plan from Singapore.
- Compare jurisdictional responses — given France also restricted Bybit, a comparative analysis of Bybit's regulatory standing across multiple jurisdictions (EU, UAE, Hong Kong) could reveal where the exchange is concentrating operations.