Knaken Goes Bust, Customers Kraken-Up: €7M Vanishes From Unlicensed Dutch Platform 🪙

A Dutch court has declared Knaken Cryptohandel BV and its affiliated foundation bankrupt after prosecutors said €7 million ($8 million) in customer assets were missing, according to a ruling issued Thursday by the Rotterdam court. The company, which operated without authorization from the Dutch Authority for the Financial Markets (AFM), blocked access to its platform in early June and the court found it had insufficient assets to fully repay users. Prosecutors, who filed the bankruptcy petition on June 30, estimate the platform served roughly 30,000 customers.

The Netherlands' Public Prosecution Service opened a criminal investigation after the FIOD, the Dutch financial crime investigation service, raided Knaken on June 29, seizing devices and assets. No arrests have been announced. Knaken, founded in Rotterdam in 2017, was one of several crypto-asset service providers that did not appear in the AFM register after the Netherlands ended its Markets in Crypto-Assets (MiCA) transition period on June 30, 2025, ahead of the EU-wide maximum deadline of July 1, 2026.

Knaken argued against bankruptcy proceedings, maintaining that customer funds held through its separate foundation, Stichting Knaken Payments, remained safe. The court disagreed, ruling that a bankruptcy trustee was required for an orderly settlement and noting that customers lacked sufficient information to determine their legal position. Under MiCA, licensed firms are required to keep client assets segregated and out of reach of creditors, though Dutch law provides no automatic deposit-style protection for crypto holders.

The AFM told media outlets earlier in July that it had begun supervisory and enforcement action against unauthorized crypto-asset service providers, having already issued penalties to exchanges operating without MiCA compliance, including a fine against OKX in 2025. Knaken is not affiliated with Kraken, the US-based global cryptocurrency exchange, which continues to operate as a separate entity.

Compensation schemes that cover bank deposits in the Netherlands do not extend to crypto assets, meaning recovery for Knaken customers depends entirely on what the trustee can trace and recover, a process that could take months with no guaranteed payout. The AFM has reiterated that unlicensed providers expose customers to heightened risks of loss, fraud and operational failure.