Bybit to Wind Down Web3 Services in Strategic Restructuring

Crypto exchange Bybit is scaling back its Web3 product suite, announcing the shutdown of several services following the closure of its NFT marketplace earlier this month.

Bybit said it will sunset a range of decentralized offerings by May 31, including its custodial Cloud Wallet, non-custodial Keyless Wallet, DEX Pro decentralized exchange, Swap & Bridge cross-chain swap widget, and its now-defunct NFT marketplace.

The company also plans to discontinue Web3 Points, its loyalty program that rewarded users with redeemable perks for on-chain activity, on April 28. Additional closures that day include the NFT Pro decentralized NFT marketplace, the Apex Pro DEX gateway, fiat on-ramp services, and its initial DEX offering (IDO) platform.

Bybit said the move is part of a broader plan to refocus on its highest-performing services.

“In line with our commitment to the evolving onchain ecosystem and delivering high-quality services to our Web3 users, we will be optimizing our current Web3 product and service offerings,” the company stated.

The announcement follows similar moves by other platforms in the space. NFT marketplace X2Y2 recently shut down its services, citing declining interest in non-fungible tokens. Market data has shown a sharp drop in NFT volumes over the past year.

While scaling back some services, Bybit is also exploring new offerings. The exchange recently integrated Bitcoin yield products from Avalon, allowing users to earn returns via institutional lending strategies on the platform.

The restructuring comes just two months after a February exploit cost Bybit more than $1.4 billion in digital assets. Despite the loss, the exchange has stated it remains solvent, with all client assets fully backed.

“Bybit is solvent even if this hack loss is not recovered. All of the client’s assets are 1:1 backed — we can cover the loss,” the company said at the time.

The exchange also had to confront public scrutiny. In early April, it denied allegations that it charges $1.4 million for token listings, calling for evidence from accusers and asserting transparency in its listing process.

Bybit’s Web3 retrenchment reflects a wider industry trend of platforms scaling back unprofitable or underutilized products as market sentiment shifts. Despite the setbacks, the exchange recently regained 7% of market share in the centralized spot trading market.