Ethena USDe Sales Banned by German Authority

BaFin, the German Federal Financial Supervisory Authority, has instructed Ethena GmbH to discontinue all public sales of its stablecoin, USDe.

This decision follows BaFin's discovery of significant issues in Ethena GmbH's approval process for USDe.

According to BaFin's announcement on March 21, 2025, Ethena (ENA)'s public sales of its synthetic dollar Ethena USDe violate the European Union’s Markets in Crypto Asset Registration regulations.

Given that stablecoin regulation is a major enforcement priority for the EU, non-compliance with MiCAR has become a significant hurdle for stablecoin issuers.

"The BaFin also has reasonable grounds to believe that Ethena GmbH in Germany is selling securities in the form of sUSDe tokens from Ethena OpCo. Ltd. without the necessary prospectus," the regulator stated.

Consequently, BaFin has directed Ethena to halt any sales to the public immediately.

Enforcement measures

The enforcement measures encompass a freeze on USDe reserves held by Ethena's custodian. Furthermore, Ethena GmbH is required to close its website portal and stop registering new customers.

Although Ethena GmbH has been prohibited from selling USDe, this order only pertains to primary sales. In this instance, BaFin's order does not impact secondary sales. Ethena Labs released a statement on X in response to the news.

"We were informed today that Ethena GmbH’s application under the MiCAR regulatory framework will not be granted. While we are disappointed by this outcome, we will continue to explore alternative frameworks."

According to the crypto platform, BaFin's order does not impact the stablecoin's listing.

The decision will also not affect the minting and redemption process through Ethena Limited, the company's entity registered in the British Virgin Islands, which is responsible for the majority of USDe minting.

"USDe remains fully backed [and] no assets have been “frozen”" Ethena emphasized.