Investing in U.S. Stocks with USDT? A Review of Bybit's MT5 CFD Functionality

Author | Cubone Wu Blockchain

This article does not constitute investment advice. Readers are advised to strictly comply with local laws and regulations and refrain from participating in illegal financial activities.

On May 19, 2025, Bybit launched U.S. stock Contracts for Difference (CFDs) on its MT5 Gold & FX platform. The initial offering supports 78 U.S.-listed company stocks, covering technology, finance, consumer, and other sectors. Most assets are set with a default maximum leverage of 5x, which cannot be manually adjusted. Specific leverage ratios can be found on the official website.

CFDs allow users to trade bi-directionally without owning the underlying stocks and utilize leverage to enhance capital efficiency. However, this also increases volatility risk. As users do not hold the actual assets, they are not entitled to voting rights or shareholder privileges. When a company issues cash dividends, the platform adjusts positions accordingly: long positions receive compensation, while short positions are debited. For stock dividends or other corporate actions involving share issuance, the platform neither distributes shares nor performs deductions or ex-right adjustments.

Account Opening and System Configuration

Users can open an MT5 account with one click via the “Gold & FX” section on Bybit’s web or mobile platforms. Login ID and investor passwords (read-only access) are automatically generated. Funds can be internally transferred in real time between the main account’s USDT wallet and the MT5 account, enabling flexible and efficient capital allocation.

To access MT5 functionality, users must complete KYC Level 2 or corporate verification to meet anti-money laundering compliance requirements.

Trading operations are executed via the MetaTrader 5 client. MT5 services are provided by Infra Capital Limited, with which Bybit has signed a cooperation agreement.

Key Risk Warnings

1. Leverage Risk: The platform provides up to 5x leverage, which amplifies both potential gains and losses. When the account margin level drops below 50%, a liquidation mechanism is triggered, forcibly closing positions in order of “maximum loss first.” The liquidation process uses market prices instead of mark prices, which may deviate from user expectations.

2. Liquidity and Execution Risk: The platform adopts a spread structure similar to the ECN model and provides raw market quotes without adding to bid-ask spreads. However, it does not disclose the names of liquidity providers, order execution paths, or trade quality reports. This lack of transparency poses risks of slippage and unverifiable execution fairness during volatile market conditions.

3. Asset Rights Limitations: CFDs are derivative instruments. Users do not own the underlying stocks and thus cannot exercise voting rights or participate in corporate governance. When cash dividends are distributed, long positions receive compensation while short positions are debited. Stock dividends involving new share issuance are not distributed, nor are any deductions or ex-rights processed.

4. Jurisdictional Compliance Restrictions: According to Bybit’s user agreement, the platform does not offer CFD services to users in restricted jurisdictions such as the United States and Japan. Users are responsible for understanding and complying with the regulatory requirements in their respective regions.

5. Holding Cost Risk: CFD trading involves costs such as spreads, opening commissions, and overnight interest (swaps). Over time, these costs may erode profits or even lead to net value decline despite an unrealized loss.

Additionally, MT5 charts display only Bid (sell) prices by default. However, buy orders or short closings are usually executed at the Ask (buy) price. This results in a systematic discrepancy between the chart price and actual execution price — an intentional platform design, not a matching failure.

Transaction Costs and Comparative Analysis

Bybit’s stock CFDs adopt a fixed commission model: $0.04 per share when opening a position, with a minimum of $5 per order; closing trades are fee-free. Overnight interest is settled daily at 00:00 UTC+3. On Fridays, triple swap fees are charged to cover weekends, and public holidays follow the platform’s announcements.

Compared with traditional financial platforms, Bybit offers certain advantages:

1. Lower Entry Barriers: Users can open MT5 accounts via Bybit’s main platform using a crypto account, without needing to submit background information such as investment experience or asset sources. The process is simple and better suited to crypto-native users.

2. Efficient Fund Transfers: USDT is supported as both margin and settlement currency. Funds can be instantly transferred between the main wallet and MT5 account without needing wire transfers or third-party payment channels, reducing time and costs.

3. More Cost-Friendly for Small Traders: Compared to IG ($0.02/share, $15 minimum) and CMC Markets ($0.02/share, $10 minimum), Bybit’s $0.04/share with a $5 minimum per order is more favorable for small-volume traders.

However, the platform also has notable disadvantages:

Compared with traditional financial institutions, Bybit’s MT5 offering still falls short in regulatory structure and transparency. Available information shows MT5 services are provided by Infra Capital Limited, a Mauritius-registered entity holding only a Category SEC-2.1B Investment Dealer License (excluding underwriting) issued by the Mauritius Financial Services Commission (FSC). This license is applicable solely under local jurisdiction and is not valid in major markets such as the EU, UK, U.S., and Japan. It lacks cross-border passporting capability.

Future Development

Bybit CEO Ben stated in a livestream on May 3, 2025, that the platform plans to “de-MT5” by the end of this quarter, allowing users to trade stock indices, gold, oil, and U.S. equities directly on the main platform without installing separate clients. Bybit also said it is actively applying for relevant regulatory licenses in regions such as Europe, Southeast Asia, and Hong Kong, while planning product upgrades and structural expansions in derivatives.

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