Germany’s BaFin Cracks Down on Ethena: USDe Issuance Halted, ENA Struggles Amid Investor Uncertainty

Strict action has been taken against Ethena GmbH, a Germany-based USDe synthetic dollar issuer after issues were found in its business organization. BaFin (Bundesanstalt für Finanzdienstleistungsaufsicht), Germany’s financial regulation authority, has taken strict action against Ethena GmbH and has placed a halt on the issuance of the USDe synthetic dollar. This decision has come to light after several shortcomings were identified in an exhaustive review of the company’s compliance with the EU’s Markets in Crypto-Assets Regulations (MiCAR). 

Suspected of Offering Unapproved Securities, Issuance Stopped

BaFin has suspicions that Ethena has been offering securities without the necessary regulatory approvals. As part of the immediate supervisory measures, BaFin has frozen the asset reserves supporting the USDe token and banned any public sales. The regulator has also restricted access for investors and ordered the closure of Ethena’s website. Despite these restrictions, secondary market trading of USDe tokens remains unaffected. BaFin’s investigation highlighted that Ethena had issued approximately 5.4 billion USDe tokens, with a substantial number distributed outside Germany before the implementation of MiCAR.

Ethena Labs Express Discontent Over the Decision

Ethena Labs expressed disappointment over BaFin’s actions but assured stakeholders that the reserves for USDe are intact and that redemption services continue through its British Virgin Islands entity. The company stated its commitment to explore alternative regulatory structures to ensure compliance and maintain operations. However, BaFin’s findings raise concerns about Ethena’s readiness to meet updated regulatory standards.

The recent development highlights the increasing investigation that cryptocurrency firms have to go through in Europe as regulatory authorities prioritize investor protection and data transparency. As discussions continue regarding the compliance of stablecoins and synthetic currencies like USDe, BaFin’s investigation and ruling will have significant effects on Ethena and other crypto projects.

This development comes days after Ripple Labs won a case against the U.S. Securities and Exchange Commission where similar claims were levied against the company. The case led to XRP underperforming for years as investor confidence ran low. Is Ethena bound towards the same fate? Let’s find out with a quick ENA price analysis. 

ENA Price Analysis: Unimpressive Showing for Ethena, Are Investors Losing Confidence?

ENA started the day strongly at $0.387, continuing from the previous days uptrend. However, the coming 24 hours spelled horror for Ethena as a deep downtrend formed. By 3:50 UTC, the price was observed at $0.374. A trend reversal was expected at this point as a golden cross formed on the MACD. However, the reversal was rather short, as ENA did not get enough buying pressure, and another downtrend ensued, taking it all the way down to $0.363 by noon UTC. The ENA price underwent a phase of range-bound behavior as the trend lines – support and resistance – both seemed to be on a converging path. 

Chart 1: analyzed by raodevansh18, Published on TradingView, March 22, 2025

This symmetrical triangle again revived hopes of a price increase, but ENA once again failed to hop onto a bullish trend. ENA eventually slumped further. Any attempts at positive movement on the chart were met by strong resistance at $0.363. ENA eventually fell further to find support at 

$0.350. Since then, ENA has been making efforts to touch resistance but has failed so far. At 4:05 AM UTC on March 22, ENA started climbing again, as an uptrend commenced from $0.351.

ENA Price Prediction: Can ENA Edge Past the $0.36 Resistance?

ENA has had an underwhelming outing on the charts in the previous 24 hours and is hoping to make a strong recovery soon. However, issues related to the German claims may have stifled buying pressure, and the result was very evident. For now it looks like the ENA price will continue its upward march and touch the $0.363 resistance very soon. If it is able to achieve that, it will form a new resistance and make a new support level somewhere around the $0.350 region.