Bybit Secures Historic SCA License, Targets Abu Dhabi as Regional Crypto Hub

Breaking: Crypto exchange giant Bybit just scored a regulatory touchdown in the Middle East.

The Strategic Play

Bybit's landmark SCA license approval positions it as the first major exchange to gain formal recognition in Abu Dhabi's burgeoning digital asset market. The move signals institutional-grade validation that traditional finance can't ignore—no matter how much they pretend blockchain is just a buzzword.

Regional Domination Strategy

This licensing coup opens floodgates to Middle Eastern capital while establishing regulatory precedent others will scramble to follow. The timing couldn't be sharper—just as legacy banks continue debating whether crypto deserves a seat at the table, Bybit's already reserving the entire VIP section.

One cynical finance jab: Because nothing says 'serious institutional adoption' like watching traditional fund managers finally understanding blockchain isn't something you need to mine for in Excel spreadsheets.

Bottom line: Regulatory milestones like this don't just change the game—they build entirely new playing fields while Wall Street's still reading the rulebook.

Increased Crypto Exposure 

The latest edition of the State Street Digital Assets and Emerging Technology Study indicates that the average portfolio allocation to various digital assets stands at 7%. However, this is projected to rise to 16% within three years. 

The report highlights that “digital cash” and tokenized versions of listed equities or fixed income are the most prevalent forms of these investments, with respondents reporting an average allocation of 1% in each category.

Interestingly, asset managers show a greater inclination towards crypto assets compared to asset owners. For instance, managers are twice as likely to hold 2-5% of their portfolios in Bitcoin (BTC)—14% of managers versus 7% of owners. 

Additionally, 5% of managers have 5% or more of their AUM in Bitcoin, compared to just 4% of owners. ethereum (ETH) also sees a similar trend, with six times as many managers holding 5% or more in Ethereum compared to their owner counterparts.

The report reveals that asset managers are leading the way in terms of exposure to tokenized assets. They report a significant presence in the tokenization of public assets (6% versus 1% for owners) and private assets (5% versus 2%). 7% of managers have invested in digital cash, compared to only 2% of asset owners.

Last year, the research did not specify percentage holdings but focused on whether respondents intended to increase their digital asset exposure. At that time, one-third of respondents (33%) planned to maintain their current holdings, while half (50%) aimed for increases within the following year. 

Looking ahead five years, 69% of respondents anticipated increasing their allocations, with 26% planning “significant” increases. This consistency in intention suggests a steady trend toward greater digital asset allocations.

Institutions Favor Bitcoin Over Other Digital Assets

Despite stablecoins and tokenized real-world assets (RWAs) forming the largest part of these allocations, crypto assets remain pivotal in generating returns. 

The report notes that 27% of respondents believe Bitcoin currently delivers the highest returns among their digital asset portfolios, with a quarter expecting it to maintain this status over the next three years. Ethereum follows closely, with 21% stating it is their primary return generator.

Looking forward, the research reveals that most institutions expect crypto assets to become mainstream within the next decade. However, respondents express caution regarding the pace of this growth. 

By 2030, 52% anticipate that digital assets or tokenized instruments will make up between 10% and 24% of all investments, while only 1% predict that the majority of investments will be conducted this way.

At the time of writing, the leading crypto, Bitcoin, is trading at $122,670. It is attempting to consolidate above the $120,000 mark, with the aim of establishing it as new support for further potential upward movements and new record highs. 

Featured image from DALL-E, chart from TradingView.com