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German Regulator Orders Ethena to Reverse USDe Token Issuance and Imposes €600K Fine

Ethena GmbH has faced significant repercussions from the German Federal Financial Supervisory Authority (BaFin) regarding its USDe token operations.

BaFin has mandated that Ethena wind down its token issuance due to serious operational deficiencies discovered during its authorization process.

The company attempted to enter the German market under the transitional provisions of the European Markets in Crypto Assets Regulation (MiCAR) but later withdrew its authorization application.

As a result, Ethena can no longer operate within the European Union and must execute a redemption plan for its USDe tokens.

In addition to reversing the token issuance, BaFin levied a coercive fine of €600,000 on Ethena.

BaFin has also imposed a ban on payments and sales to protect the company’s assets and ensure creditor obligations are met.

This situation highlights the increasing scrutiny and regulatory pressure faced by cryptocurrency projects in Europe.

Ethena's case underscores the importance of compliance with financial regulations in the evolving crypto landscape.

As authorities tighten their grip, firms in the sector may need to reassess their operations to avoid similar fates.

The events serve as a stark reminder of the regulatory challenges that can impact cryptocurrency firms operating globally, including those dealing with Bitcoin.