BaFin, the German financial regulatory authority, has prohibited all public sales of Ethena GmbH’s USDe — a synthetic dollar — claiming that the token violates the European Union’s MiCAR regulations.
According to the announcement from the regulator, BaFin has ordered the firm to freeze the reserve assets that back the token, close down the website portal, and has ordered the firm to stop taking new customers. In a translated statement, the regulator wrote:
“The BaFin also has reasonable grounds to suspect that Ethena GmbH in Germany sells securities in the form of sUSDe tokens from Ethena OpCo. Ltd. without the required prospectus.”
“The USDe and sUSDe tokens are interconnected in such a way that investors can receive a sUSDe token in exchange for a USDe token,” the regulator continued.
Despite the ban on primary sales and issuance of the token, the regulator said that secondary sales of the token will not be prohibited or affected.
This is a developing story, and further information will be added as it becomes available.