Bybit doesn’t let you trade if you’re in the United States - and it doesn’t care if you’re using a VPN to sneak in. That’s not just a technical rule. It’s a legal line in the sand. For traders outside the U.S., this might seem like a minor inconvenience. But for those in restricted regions, it’s a constant game of cat and mouse with a platform that’s trying to stay out of regulators’ crosshairs.
How Bybit Blocks Access with Geofencing
Bybit uses IP address geolocation to decide who can sign up or log in. If your IP shows you’re in the U.S., Canada, or a handful of other restricted countries, you’ll get blocked before you even reach the login page. This isn’t a glitch. It’s intentional. The system checks your location during account creation, login, and even during active trading sessions.It’s not just about your IP. Bybit also cross-checks the country on your government-issued ID during KYC. If you’re using a U.S. passport but connecting from a VPN in Singapore, the system *might* let you through - but only if it doesn’t catch the mismatch. And that’s where things get messy.
Why does Bybit do this? Because the U.S. has some of the strictest crypto regulations in the world. After Binance paid $4.3 billion to settle with U.S. authorities, Bybit chose a different path: keep its global platform, but lock out Americans entirely. Unlike Coinbase or Kraken, which got licensed to operate in the U.S., Bybit decided it wasn’t worth the legal risk. So instead of building compliance into its core, it built a fence around it.
Can You Beat Bybit’s VPN Detection?
Yes. And no.Many traders use standard commercial VPNs - NordVPN, ExpressVPN, Surfshark - to mask their location. The process is simple: turn on the VPN, connect to a server in a permitted country like Japan or Germany, then sign up with a foreign ID. CoinDesk confirmed this method works. Users have reported successful KYC approvals using Canadian, Australian, or German documents while physically sitting in Texas.
But here’s the catch: Bybit’s detection system is basic. It doesn’t scan for VPN fingerprints. It doesn’t check your browser’s canvas fingerprint, device timing, or DNS leaks. It just looks at your IP. That means any decent VPN with a clean IP pool will slip through. There’s no real-time behavioral analysis. No machine learning flagging unusual login patterns. Just a simple IP-to-country lookup.
That’s why thousands of U.S. traders still use Bybit. They’re not hackers. They’re regular people who want access to better leverage, lower fees, and deeper liquidity than what U.S.-licensed exchanges offer. But they’re also violating Bybit’s Terms of Service. And that’s a risk.
What Happens If You Get Caught?
Bybit doesn’t publicly say how often it audits accounts or shuts them down. But user reports on Reddit and Trustpilot suggest it happens - especially after major regulatory crackdowns. If your account is flagged for inconsistent IP and ID locations, you might get locked out. Funds aren’t always frozen immediately, but withdrawals can be suspended pending review.There’s no appeals process that’s transparent. You won’t get an email saying, “We detected you’re using a VPN.” You’ll just log in one day and see a message: “Access denied. Contact support.” And support rarely gives answers.
Some users have reported account reinstatement after submitting additional documentation - but only if they admit to using a VPN and promise to stop. Others have lost months of trading history and never gotten their funds back. There’s no guarantee. It’s a gamble.
Why Other Exchanges Are Doing More
Bybit isn’t alone. Bitget, OKX, and others use similar geofencing. But some are going further.For example, Sky Protocol (formerly MakerDAO) blocked *all* VPN users in August 2024 - no exceptions. Even if you’re in Germany using a German IP through a VPN, you’re out. That’s extreme. It’s also risky. It alienates legitimate users in countries with censorship or unstable internet.
Meanwhile, exchanges like Coinbase and Kraken don’t block VPNs at all - because they’re licensed in the U.S. They don’t need to. Their compliance is baked into their structure. They report to the SEC, follow AML rules, and offer regulated products. That’s the long-term play.
Bybit’s approach is a stopgap. It’s cheaper than hiring legal teams in 50 states. But it’s also fragile. One major regulatory shift - like the U.S. classifying crypto derivatives as securities - could force Bybit to shut down entirely. Or worse, get hit with fines for knowingly letting U.S. users trade.
The Security Hole Behind the Fence
In 2024, Bybit lost $1.4 billion in a hack tied to North Korea’s TraderTraitor group. The attackers didn’t break into the exchange’s cold wallets. They compromised the SAFE Wallet frontend - the interface traders use to approve transactions. They slipped in malicious code that made fraudulent transfers look like normal ones.Why does this matter to geofencing? Because security and compliance are connected. If your platform is vulnerable to code injection, then your IP checks mean little. A hacker can spoof location data. A compromised user can bypass KYC. A botnet can flood the system with fake IPs.
After the hack, Bybit hired Mandiant - Google’s cybersecurity arm - to fix things. But the damage was done. Trust took a hit. And that’s the real cost of relying on simple geofencing: it gives users a false sense of security. You think you’re protected because you’re blocking Americans. But if your backend is weak, you’re just hiding behind a cardboard wall.
What’s Next for Bybit’s Restrictions?
The industry is moving toward smarter detection. Some exchanges are testing:- Device fingerprinting - checking your browser, OS, screen resolution, and installed fonts
- Connection timing - detecting if your IP suddenly switched from New York to Tokyo in 3 seconds
- Behavioral AI - flagging accounts that log in from 3 countries in one day
- Mobile app telemetry - tracking GPS data from mobile apps (even if you’re using a VPN on desktop)
Bybit hasn’t rolled out any of these yet. But pressure is growing. Regulators in the EU, UK, and Australia are demanding better controls. If Bybit wants to keep expanding in those markets, it can’t keep relying on outdated IP checks.
For now, the system remains a blunt tool. It blocks the obvious. But it misses the clever. And it does nothing to stop the real threats: hackers, fraudsters, and internal vulnerabilities.
Should You Use a VPN on Bybit?
If you’re in the U.S. or another restricted country, you already know the answer. Most traders who use Bybit are using a VPN. It’s common. It’s easy. And right now, it works.But here’s the reality: you’re breaking the rules. You’re risking your funds. And you’re supporting a platform that’s avoiding legal responsibility - not solving it.
If you want to trade crypto legally and safely, the only real solution is to use a licensed exchange. Yes, the fees are higher. The leverage is lower. But your money stays protected. Your account won’t vanish overnight. And you won’t be part of a loophole that could collapse under the next regulatory wave.
Bybit’s geofencing isn’t about security. It’s about survival. And right now, it’s working - barely. But for traders, it’s a house of cards. One update. One audit. One legal order - and the whole thing could come down.
What You Can Do Today
- If you’re outside restricted zones: Double-check your IP and ID match. Don’t use a VPN unless you’re traveling.
- If you’re in the U.S.: Consider switching to a U.S.-licensed exchange like Coinbase or Kraken. The features are catching up.
- If you’re already on Bybit with a VPN: Back up your keys. Don’t leave large sums on the platform. Assume your account could be frozen tomorrow.
- Never use someone else’s ID. That’s identity fraud - and it’s a felony in many countries.
There’s no perfect solution. But there are safer ones. And they don’t involve pretending you’re someone else - or somewhere else.