German financial supervisor Bafin said it had identified a “severe flaw” in Ecena’s synthetic USDE Stablecoin.
Ecena is a yield generation protocol. Stablecoin’s market capitalization is $5.4 billion.
Ethena said in X that “applications under the Micar regulatory framework will not be approved,” and that it will “continue evaluation of alternative frameworks.”
In a statement, Bafin said the defects were related to “violations of MICAR requirements, including those relating to bank business organizations and those relating to asset reserves and compliance with capital requirements.”
“Buffin has reasonable grounds to suspect that Ethena GmbH is offering securities publicly in Germany in the form of Ethena Opco Limited’s “Susudé” tokens without the necessary securities prospectus,” the regulator said.
Ethena’s Ena Tokenhad has dropped by 6.5% over the last 24 hours, extending the losses after the announcement, according to CoinmarketCap data.
