BaFin Identifies Serious Deficiencies in Ethena’s sUSDe Stablecoin
The German financial supervisory authority, BaFin, has reported “serious deficiencies” in Ethena’s synthetic USDe stablecoin, which currently has a market cap of $5.4 billion.
Ethena, known for its yield-generating protocol, announced on X that it will “continue to evaluate alternative frameworks” after being informed that its application under the MiCAR regulatory framework will not be approved.
BaFin highlighted that the deficiencies are linked to issues in the bank’s business organization and breaches of MiCAR requirements, including asset reserves and capital compliance.
Furthermore, BaFin suspects that Ethena GmbH is unlawfully offering securities in Germany through the ‘sUSDe’ tokens of Ethena OpCo. Ltd. without the necessary securities prospectus.
In the wake of this news, Ethena’s ENA token experienced a decline of 6.5% over the past 24 hours, extending its losses, according to CoinMarketCap.
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