Dutch cryptocurrency platform Knaken has been declared bankrupt by a Rotterdam court after prosecutors alleged that around €7 million in customer funds could not be accounted for.
Summary
- Crypto exchange Knaken was declared bankrupt after prosecutors alleged €7 million in customer funds disappeared.
- A Rotterdam court said Knaken lacked enough assets to repay customers fully after operations stopped.
- Knaken’s collapse follows MiCA enforcement, which now bars unlicensed crypto firms from serving EU customers.
The ruling followed a bankruptcy request filed by the Netherlands Public Prosecution Service in late June after regulators raised concerns about the company.
According to NL Times, the Dutch Authority for the Financial Markets alerted prosecutors to what it described as a “very concerning situation” at Knaken. A criminal investigation is also underway into the alleged missing customer funds.
The court said Knaken had a large deficit that users had not been told about.
“A large amount of customer money has disappeared without it being clear how this could have happened,” the court said.
The platform had already gone offline in early June, leaving customers unable to access their accounts through its website.
Knaken opposed the bankruptcy request and argued that other legal measures could protect customers. The company pointed to assets seized by the Fiscal Information and Investigation Service and proposed distributing available funds directly to users. However, the court rejected that plan after finding that Knaken did not hold enough assets to repay customers in full.
Knaken collapse comes as MiCA reshapes European crypto market
The bankruptcy arrives shortly after the European Union completed its transition to the Markets in Crypto-Assets framework. Under the new regime, crypto service providers need authorization from an EU regulator to continue offering covered services across the bloc. The Netherlands ended its national transition period earlier, while the wider MiCA transition ended on July 1, 2026.
Knaken had previously operated as a Dutch crypto services provider but was not listed among the firms authorized under the new MiCA system at the time of its collapse. The AFM states that companies offering covered crypto services in the Netherlands must hold a license or valid notification from an EU regulator.
The wider market has been moving quickly toward licensed providers. As crypto.news previously reported, firms without MiCA authorization had to wind down covered EU services after the July 1 deadline while protecting customers during the process. The EU had issued 244 MiCA licenses by June 29.
Meanwhile, licensed companies including Coinbase and Ripple have expanded across Europe as other platforms reduced services after failing to secure approvals. The shift has increased the divide between regulated operators and companies unable to meet the new licensing requirements.
Knaken’s bankruptcy now leaves the court-appointed process to determine how much money and crypto can be recovered for creditors and customers. Prosecutors continue investigating the alleged €7 million shortfall, while the available public information does not yet explain where the missing funds went.
