Thomas Daniels
Germany’s Federal Financial Supervisory Authority (BaFin) has mandated that Ethena GmbH cease all public sales of its stablecoin, USDe, citing significant regulatory violations. The regulator identified substantial deficiencies in Ethena’s compliance with the European Union’s Markets in Crypto-Assets Regulation (MiCAR), particularly concerning asset reserves and capital requirements.
In its enforcement action, BaFin has frozen the reserves backing the USDe token, ordered the shutdown of Ethena’s website, and prohibited the onboarding of new customers. While primary sales and redemptions through Ethena GmbH are suspended, secondary market trading of USDe remains unaffected.
The regulator also suspects that Ethena GmbH has been offering sUSDe tokens, issued by Ethena OpCo. Ltd., without the necessary prospectus, potentially constituting unregistered securities.
In response, Ethena Labs expressed disappointment over BaFin’s decision but affirmed that USDe remains fully backed and that minting and redemption services continue through Ethena Limited, registered in the British Virgin Islands.
This development underscores the EU’s intensified scrutiny of stablecoin issuers and highlights the imperative for strict adherence to regulatory standards within the digital asset industry.
