TL;DR
The Rotterdam court declared Knaken Cryptohandel BV and its affiliated foundation bankrupt, after the Dutch Public Prosecution Service confirmed that €7 million in client assets are missing. The court held that bankruptcy was necessary to ensure an orderly wind-down, given that the platform had blocked users’ access to their accounts and lacked sufficient assets to fully reimburse them.
According to the court ruling, clients had not received sufficient information to determine their legal situation. The court underscored that a significant funding deficit exists and that it remains unclear how the money disappeared. The bankruptcy was declared, in the court’s own words, in the public interest.
The Public Prosecution Service filed the bankruptcy petition on June 30, the same date on which the Netherlands’ transition period under the European Markets in Crypto-Assets (MiCA) regulation expired. That same month, the financial crimes investigation service FIOD raided the company’s offices and seized devices and assets.
Knaken does not appear in the register of crypto-asset service providers authorized by the Dutch Authority for the Financial Markets (AFM), which had already flagged a “very concerning” situation at the company.
Founded in Rotterdam in 2017, the platform allowed users to convert money into cryptocurrencies and vice versa, as well as custody their assets. It went offline abruptly in early June and even urged its clients to not file damage claims. Before the court, Knaken argued that bankruptcy was not the best path to wind down the company and proposed distributing the available funds among those affected. The judge rejected the proposal on the grounds that the available resources were insufficient to cover the debts owed to clients.
