Crypto derivatives exchange Bybit will stop serving UK clients on March 31, it said in an announcement this morning. The exchange cited new regulations for crypto-based derivatives as the reason behind the move.
“To comply with the Financial Conduct Authority’s (FCA) ban of crypto derivatives, Bybit will cease to provide services to customers from the United Kingdom,” the exchange said in its release, requesting clients to close any positions and withdraw all funds before the end of this month.
Derivatives are niche financial instruments that track the prices of an underlying asset, or crypto in this case. Customers do not hold any spot crypto while buying these products, and the use of high leverage makes them a popular product among crypto traders.
But the UK FCA banned the sale of crypto derivatives and exchange-traded notes (ETNs) in a sudden move last year. It said that such products were “ill-suited for retail consumers” due to the volatile nature of their underlying assets and the lack of a need for such crypto derivatives.
The ban went into effect in January 2021, but some, like Bybit, carried on with basic operations to existing clients. That won’t continue now, however, and UK-based users trying to make new accounts would be prevented from making an account. “Sign-ups using U.K. mobiles number and/or IP addresses will be restricted immediately,” Bybit said.
Bybit is one of the biggest crypto derivatives exchanges. As per markets tracker CoinGecko, the exchange traded over $11 billion in the past day over ten trading pairs. Website analytics service SimilarWeb suggest the platform is popular among UK traders, with over 5% of all visitors to its site coming from the country.
Meanwhile, the exchange added that it would continue to speak with local authorities to explore options for new and existing clients.