Bybit Plans Gradual Exit From Japan Starting 2026 as Regulatory Pressure Builds

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• Bybit will begin restricting Japan-based accounts gradually from 2026.
• The exchange is not registered with Japan’s Financial Services Agency.
• Bybit is expanding in the UK and UAE despite exiting Japan.

Bybit is preparing to wind down its services for users based in Japan, with a phased withdrawal set to begin in 2026. The move reflects growing regulatory pressure in one of the world’s most tightly controlled crypto markets and marks another step back for offshore exchanges operating without local approval.

The crypto trading platform said accounts identified as belonging to Japanese residents will face progressive restrictions over time. Users who believe they were incorrectly classified will be asked to complete additional identity verification as part of the review process.

Regulatory Wall Forces Strategic Shift

Japan requires crypto exchanges serving local users to register with the Financial Services Agency (FSA), a standard Bybit does not currently meet. Enforcement has intensified in recent years, making it increasingly difficult for global platforms to operate without formal authorization.

Earlier this year, Japan’s regulator asked major app stores to block downloads of several unregistered exchanges, including Bybit. The request sent a clear message that authorities are willing to use indirect measures to curb access to platforms operating outside the licensing framework.

What Japanese Users Should Expect

Bybit says the transition will not be abrupt. Instead, restrictions will be rolled out gradually, giving affected users time to respond and manage their accounts. Further instructions are expected as the remediation process develops.

The exchange had already paused new user sign-ups in Japan last year while engaging with regulators. The latest announcement suggests those discussions did not lead to a workable path forward under current rules.

Japan’s Strict Rules and Industry Impact

Japan is often viewed as a leader in consumer protection, but critics argue its regulatory model is driving innovation offshore. Industry figures have warned that lengthy approval processes and rigid compliance standards discourage new entrants and limit competition.

Bybit’s exit underscores that tension. Despite handling billions of dollars in daily trading volume globally, the exchange appears unwilling to commit the resources required to secure Japanese registration.

Expansion Elsewhere Offsets the Exit

While pulling back from Japan, Bybit is expanding in other regions. The exchange has recently reentered the UK market with a revised platform offering spot trading and peer-to-peer services through an approved promotions arrangement. It has also strengthened its presence in the Middle East after securing a virtual asset license in the United Arab Emirates.

Also Read: Crypto ETPs See $952M Outflows as U.S. Regulatory Delays Rattle Markets

Bybit’s planned withdrawal from Japan highlights how uneven global regulation is reshaping the crypto industry. As exchanges prioritize jurisdictions with clearer rules, Japanese users may see fewer global platforms—but tighter oversight.

Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.