Decentralized finance platform Ethena announces the closure of its operations in Germany due to regulatory pressures.
Reasons for Ethena's Exit from Germany
Ethena decided to cease operations in Germany after receiving warnings from the federal financial regulator BaFin. The watchdog indicated that the company lacked necessary approvals for offering crypto products and identified significant problems with its USDe token.
User Transition to BVI Arm
Although Ethena is closing its German branch, it plans to move existing users to its branch in the British Virgin Islands. This transition will allow the company to continue its operations under a different legal framework.
Market Reaction to Ethena's News
Following the announcement, the price of Ethena's ENA token dropped by 2.88% in the last 24 hours, while the broader cryptocurrency market saw a 1.17% increase. Investors are reacting to the uncertainty stemming from the company's regulatory challenges.
Ethena's exit from Germany highlights the increasing pressure on cryptocurrency firms in Europe due to new regulatory requirements. The brand will continue operating in other jurisdictions with less stringent regulations.
