Rotterdam court finds €7m missing at Knaken exchange

A Rotterdam district court placed Knaken Cryptohandel B.V. and Stichting Knaken Payments into court-controlled bankruptcy on July 16 after finding the exchange could not meet customer obligations and that roughly €7 million was missing from customer balances. Trustee C.F.W.A. Hamm was appointed to manage the wind-down and company management no longer controls the process.

The court record states customers were locked out, outgoing payments had stopped and the platform had not disclosed the coverage deficit. Prosecutors told the court that the missing amount came from customer balances. The trusteeship replaces a payout plan the company had proposed and gives an independent administrator authority over both entities.

Under Dutch bankruptcy practice the trustee represents the collective body of creditors under a supervising judge. The trustee must take inventory of assets, reconcile platform ledger entries with blockchain wallets and bank accounts, examine access controls and records, protect and liquidate estate property, and propose distributions according to statutory priority rules. The trustee must also determine which legal entity owes each customer and whether assets labeled as customer property were actually held separate from the company’s general estate.

Investigators from the Fiscal Intelligence and Investigation Service carried out searches on June 29 and seized digital storage devices and company assets, prosecutors reported. No arrests had been reported as of the court announcement. Civil and criminal teams are handling separate inquiries, and prosecutors noted that seizures and searches do not constitute findings of guilt. How seized property will be coordinated between criminal authorities and the bankruptcy estate remains to be clarified.

Knaken argued in filings that bankruptcy was unnecessary, citing criminal asset seizures, a shutdown of services and its custody structure as protections for customers. The company proposed an independent verification followed by its own distribution protocol; the court rejected that proposal and placed an outside trustee in charge to supervise reconciliation.

Prosecutors said Knaken had not obtained required authorization from the Dutch Authority for the Financial Markets. The Markets in Crypto-Assets Regulation sets standards for authorized custody providers, including keeping per-client records, maintaining custody policies and return procedures, and legally and operationally separating client holdings from the provider’s own assets. Those regulatory rules aim to prevent custody failures but do not replace assets that are already missing.

De Nederlandsche Bank states crypto assets and crypto service providers fall outside the national investor compensation scheme and deposit-guarantee arrangements. Any treatment of cash held at banks will depend on legal ownership and account structures that the trustee must establish.

The next step for customers is a reconciled inventory of crypto, cash and other property that the trustee can control or recover, matched against records of the operating company and the foundation. Only after ledger entries can be linked to identifiable assets and ownership clarified can the trustee propose distributions and estimate potential recoveries.