Bybit to Soon Close Services in Japan as Regulatory Pressure Mounts

Bybit will begin winding down services for users in Japan starting in 2026, marking another retreat from one of the world’s most tightly regulated crypto markets. The exchange confirmed on Monday that Japanese residents will face gradual account restrictions as part of a compliance driven exit.

According to Bybit, users identified as Japan residents will be restricted on a rolling basis. The exchange said some accounts may have been flagged incorrectly and asked those users to complete additional identity checks. Bybit is not registered with Japan’s Financial Services Agency, which requires crypto exchanges to hold local approval before serving residents.

“If you’re a resident of Japan, please note that starting from 2026 your account will be subject to gradual restrictions,” the exchange said, adding that further updates will be shared directly with affected users.

Bybit remains one of the largest crypto trading platforms globally. Data shows the exchange processed about $4.3 billion in trading volume over the past 24 hours, ranking it near the top of centralized exchanges by activity.

Japan Tightens the Net on Offshore Exchanges

The latest move follows earlier steps taken by Bybit to reduce exposure to Japan. In October, the exchange paused new user registrations in the country, citing ongoing discussions with regulators. That decision came as enforcement pressure increased on offshore platforms operating without approval.

In February, Japan’s Financial Services Agency formally requested Apple and Google to halt downloads of several unregistered crypto exchanges. The list included Bybit, MEXC Global, LBank Exchange, KuCoin, and Bitget. The action cut off a major access point for retail users and signaled stricter enforcement rather than warnings.

Japan’s crypto oversight framework is among the most demanding globally, with high compliance costs and strict operational rules. Industry figures have repeatedly said the system discourages foreign platforms and slows domestic growth. In July, WeFi CEO Maksym Sakharov said regulatory friction was pushing crypto innovation out of Japan, as firms choose regions with clearer and faster approval paths.

Bybit Expansion Continues Outside Japan

While pulling back from Japan, Bybit is expanding elsewhere. The exchange recently reentered the UK market after a two year absence. It launched a new platform offering spot trading and peer to peer services through a promotions arrangement approved by Archax, rather than holding its own UK registration.

Bybit has also made progress in the Middle East. Last month, it secured a Virtual Asset Platform Operator License from the United Arab Emirates Securities and Commodities Authority. The approval followed an in principle clearance granted eight months earlier.

The contrast highlights Bybit’s regional strategy. Markets with rigid entry barriers are being exited or scaled down, while jurisdictions offering clearer licensing routes are becoming core growth targets as global crypto regulation fragments further.