Germany’s financial watchdog has taken its first significant enforcement action under the EU’s new crypto regulatory framework, ordering Frankfurt-based Ethena GmbH to cease operations and liquidate its USDe stablecoin business.
This decision reflects a broader effort to enforce stricter oversight on crypto firms across the EU. The Federal Financial Supervisory Authority (BaFin) issued the directive on Monday, instructing Ethena GmbH to halt all authorized business activities and settle its outstanding obligations.
Earlier, BaFin had identified “serious deficiencies” in Ethena’s organizational setup and its compliance with the Markets in Crypto-Assets Regulation (MiCA), which led to supervisory sanctions in March.
BaFin noted, “Ethena GmbH utilized a transitional arrangement under MiCAR to enter the German market. This arrangement allows issuers, who issued asset-referenced tokens under the law applicable before June 30, 2024, to continue until they receive or are denied authorization.”
