On April 15, the crypto market saw significant developments, including a security breach at ZKSync, Ethena Labs' regulatory shutdown in Germany, and Tether's new investment in fintech firm Fizen Limited.
ZKSync, a Layer 2 scaling solution for Ethereum, has suffered a serious security breach. On Tuesday, the ZKSync security team confirmed that an attacker stole approximately $5 million worth of ZK tokens from a compromised admin account. This incident comes after the attacker took control of the unclaimed tokens from the ZKSync airdrop contract.
The security breach raised community-wide concerns even though user funds remained safe. ZKSync team members confirmed that the platform's ZKSync protocol and ZK token contract operations were secure, and additional tokens remained untouched by the incident. The value of the ZK token suffered a substantial decline after this security incident, dropping by 15% within an hour.
The ZKSync team started an investigation and discovered that the hack happened due to a breached key used to manage the airdrop contract. Additionally, the vulnerability has aggravated issues among ZKSync users, who criticized previous token distribution methods as they believed they were not equitable and exposed to Sybil attack risks.
Ethena Labs declared the shutdown of its German subsidiary, Ethena GmbH, due to regulatory decisions from BaFin, Germany's financial oversight organization. After facing regulatory pressure, Ethena Labs abandoned attempts to get the EU’s Markets in Crypto-Assets Regulation (MiCAR) approval for its German operations.
The move comes after BaFin ordered Ethena to halt public sales of the USDe token, citing compliance issues with MiCAR. Ethena Labs confirmed that all minting and redemption activities for USDe have been moved to its British Virgin Islands subsidiary, Ethena Limited.
This decision directly impacted the company’s operations in Germany, demonstrating expanding regulatory attention toward stablecoin initiatives throughout Europe. Ethena's exit from the German market shows the escalating regulatory challenges that crypto projects encounter in this area since MiCAR regulations have become stricter in their enforcement. Despite these challenges, Ethena remains committed to finding alternative regulatory frameworks outside German jurisdiction.
The issuer of USDT stablecoin Tether announced an investment into Fizen Limited to advance stablecoin use in commercial applications. Through this strategic alliance, the two entities strive to establish connections between cryptocurrency operations and conventional banking services while providing financial options to unbanked groups.
Fizen’s technology enables businesses to accept stablecoin payments while allowing consumers to transact using stablecoins like USDT, and receive settlements in fiat currencies. The solution seeks to make digital assets more accessible and practical for people who lack access to standard banking resources due to location restrictions or documentation requirements.
Paolo Ardoino, Tether’s CEO, emphasised this point by indicating the need to offer reliable digital financial solutions to more people around the globe. "Tether’s investment in Fizen underscores our commitment to expanding global access to efficient and reliable digital financial solutions that promote the informed, responsible use of digital assets in everyday life," he added.