Dutch Court Rules Knaken Bankrupt Over €7M Missing Funds Amid MiCA Crackdown

The Rotterdam court has declared Knaken Cryptohandel BV and its affiliated foundation bankrupt after prosecutors revealed the platform was missing €7 million (approximately $8 million) in customer assets. The ruling, issued on Thursday, was necessitated due to the company's inability to fully repay users, with the court noting insufficient assets and inadequate customer information. The Dutch Public Prosecution Service filed for bankruptcy on June 30 after initiating a criminal probe, while the Netherlands' financial crime agency raided the company in late June, seizing devices and assets. Knaken, founded in Rotterdam in 2017, went offline in early June but was not registered with the Dutch AFM (Authority for Financial Markets). The AFM had already begun supervising unauthorized crypto providers after the Netherlands' MiCA transition period ended on June 30, 2025, though the EU-wide deadline extends until July 1, 2026. This bankruptcy case highlights the challenges of crypto regulation in the Netherlands, where unlicensed platforms risk eroding investor trust.

The collapse of Knaken underscores the risks posed by unregulated crypto services during MiCA's enforcement phase. The platform's sudden shutdown and lack of transparency further emphasize the need for stricter oversight in the crypto ecosystem. This incident serves as a cautionary tale, suggesting that regulatory frameworks must be fortified to restore confidence in crypto markets.