According to Ethena's official statement, Germany's BaFin has informed its Frankfurt-based entity Ethena GmbH that the MiCAR compliance application will not be approved, but the decision does not affect the current listing of USDe on the exchange and the casting and redemption services through British Virgin Islands entity Ethena (BVI) Limited. Ethena stressed that USDe is still fully asset-backed and has not been "frozen". Other regulatory paths will be evaluated in the future, and the relevant terms of service will be revised in the next week to reflect the current changes. The incident will not affect the normal usage process of most users.