This paper proposes an optimized design of high-power vacuum bypass switches based on branch shunt. This design achieves fault current suppression flowing through the bypass switch by constructing a parallel MOV branch of the bypass switch and increasing the series inductance under extreme working condition to reduce the current. The simulation results show that under the extreme working condition of the MMC sub-module failure, the vacuum bypass switch designed in this paper limits the peak current flowing through it from 600 to 40 kA by the MOV clamping voltage, with a reduction of more than 90%. Meanwhile, the nonlinear influence of the capacity of the energy storage capacitor on the closing speed is analyzed to optimize the dynamic characteristics of the switch closing, which is conducive to the reliable closing of the bypass switch of the sub-module under extreme fault condition.