Timeline and user actions that determine account continuity
Bybit will stop accepting new registrations from Japanese residents on October 31, 2025 at 12:00 PM UTC. Existing accounts will remain active initially but will face staged limitations starting in 2026 under a phased remediation plan.
For users who were incorrectly flagged as Japanese residents, the path to continuity is procedural. Bybit says affected users must complete Identity Verification Level 2, including proof of address, by January 22, 2026 to avoid service interruption. The exchange also states it will communicate additional details directly to impacted users regarding the sequence and scope of restrictions.
The underlying rationale is compliance feasibility. Bybit links its exit to intensified Japanese regulatory scrutiny and the fact that it is not registered with Japan’s Financial Services Agency, which it describes as making full compliance impractical under current rules. The text also points to a potential reclassification of certain digital assets under securities law, which would raise licensing and operational obligations.
This is consistent with a market-by-market operating model rather than a blanket retreat. Bybit frames the move as selective regulatory engagement: it pursues registration where achievable and exits where obligations become prohibitive. The same text notes a mix of outcomes elsewhere—formal licensing and operational hubs in some jurisdictions, re-entry via compliant promotional arrangements in others, and outright inaccessibility or cease-operation orders where requirements are unmet.
For Japan-based traders and treasury managers, the operational impact is immediate. The practical effect is reduced offshore venue optionality for Japanese residents and likely flow migration toward platforms with local authorization or domestic alternatives. More broadly, the episode reinforces a baseline planning assumption for market participants: exchange access is increasingly a function of local licensing, not global reach.
