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Ethena Labs has ceased its operations in Germany after reaching an agreement with the Federal Financial Supervisory Authority (BaFin). The move comes after BaFin identified compliance issues with Ethena’s synthetic dollar-pegged stablecoin, USDe. As a result, Ethena GmbH, the company’s German subsidiary, will no longer pursue authorization under the European Union’s Markets in Crypto-Assets Regulation (MiCA).
Since March 21, 2024, Ethena GmbH has halted all minting and redemption activities for USDe. Affected users have been transitioned to Ethena BVI Limited, which now handles their transactions. Despite the cessation of primary sales, secondary market activities involving USDe remain unaffected.
The USDe token employs an automated delta-hedging strategy to maintain its dollar peg, distinguishing it from other stablecoins like USDT and USDC. At the time of this announcement, USDe’s circulating supply was approximately $4.9 billion.
Ethena Labs’ decision to exit the German market underscores the increasing regulatory scrutiny faced by crypto assets in Europe. The company continues to operate in other jurisdictions and remains committed to compliance with applicable regulations.
For more details, refer to the original article on Cointelegraph.
