Germany’s financial regulator BaFin and Ethena GmbH have agreed on a 42-day redemption window for EU-based holders of the USDe stablecoin, ending August 6, 2025. After that, all redemptions must go through Ethena (BVI) Ltd, the company's offshore affiliate. A BaFin-appointed supervisor will oversee the process. This marks Ethena’s full withdrawal from the EU/EEA crypto market.
🔍 Key Points:
🗓️ Redemption Deadline: EU users must redeem their USDe by August 6, 2025.
👩⚖️ Regulatory Oversight: A BaFin-appointed supervisor will manage the process.
🌍 Offshore Transition: Post-deadline, redemptions shift to Ethena (BVI) Ltd.
🚫 EU Exit: Ethena GmbH will be officially wound down and exit all EU/EEA operations.
💸 Penalties & Violations:
■BaFin cited Markets in Crypto-Assets Regulation (MiCA) violations.
■Claimed sUSDe yield tokens were unregistered securities.
■Issued a €600,000 coercive fine.
■Froze reserve assets and shut down German operations.
🔄 Offshore Shift:
Issuance and redemption have already migrated to Ethena (BVI) Ltd.
Secondary market trading continues; primary EU functions halted.
❓ Future Plans Unknown: Ethena has not announced any plans to re-enter the EU under MiCA.
🧭 What It Means for Ethena Holders:
⚠️ Urgent Action Required (EU holders):
EU-based users must redeem their USDe by August 6, 2025, or rely on offshore claims, which may offer weaker protections.
🔁 Offshore Users Unaffected:
If you're already using Ethena (BVI) Ltd, your services will continue without interruption.
🛑 No More EU Support:
Ethena GmbH will stop all activity in the EU after the redemption period ends.
🤔 Regulatory Risk Remains:
Re-entry into the EU will require full MiCA compliance, which is currently uncertain.
📉 Price Outlook for Ethena (USDe/sUSDe):
🪙 Short-term pressure:
Negative regulatory headlines and a forced EU exit may shake investor confidence, potentially leading to slight depegging or reduced demand in the short term.
🔄 Stability expected offshore:
As long as Ethena (BVI) Ltd maintains proper collateral and redemption mechanisms, USDe is likely to remain close to $1, particularly in offshore markets.
📈 Mid- to long-term:
If Ethena can successfully navigate offshore growth and improve transparency, it may recover user trust and attract non-EU users, possibly strengthening both USDe and sUSDe.
📌 Bottom Line:
This marks a major regulatory blow for Ethena in the EU, but not necessarily the end of its stablecoin ambitions. Short-term volatility is possible, but offshore operations are expected to stabilize pricing unless further legal risks emerge.