Dutch Prosecutors Seek Bankruptcy of Unlicensed Knaken Exchange
In brief
- Dutch prosecutors filed bankruptcy petition against Knaken Cryptohandel in Rotterdam court
- Platform offline since June, 30,000 customers unable to access crypto holdings
- Knaken operated without required AFM license from Dutch markets regulator
- Parallel criminal probe by FIOD underway alongside bankruptcy action
- Europe's MiCA transition period expires July 1, barring unlicensed platforms from EU
Offline and Unresponsive
Knaken has been offline since early June, leaving customers stranded. The platform allowed users to swap euros for cryptocurrencies including Bitcoin and Ethereum, as well as trade and store digital assets — but it did so without obtaining a required license from the Dutch markets regulator, the AFM. Knaken has stopped paying customers out and has reportedly told them not to file damage claims.
Prosecutors said they are "very concerned" the winding-down process isn't orderly. If the court agrees to the bankruptcy petition, a court-appointed trustee would take over Knaken's assets and decide what can be returned to customers and creditors. That outcome remains uncertain.
Criminal Investigation Running Parallel
The Fiscal Information and Investigation Service (FIOD) is conducting a criminal probe into possible offenses at Knaken. On Monday, investigators carried out searches, seized laptops and phones, and confiscated company assets, with no arrests made.
The timing matters. Europe's crypto licensing regime MiCA has a transition period expiring July 1, after which platforms without authorization can no longer legally serve EU customers. The Netherlands closed its own grace period for crypto platforms a year ago. Knaken was already operating past that deadline.
From Sponsorships to Bankruptcy
Knaken had courted the mainstream as a sponsor of Dutch football clubs, including Ajax, Feyenoord, and Sparta Rotterdam. Ajax dropped the company after two months, and Feyenoord ended its partnership last year. The exits signaled early trouble. In its 2024 annual accounts, Knaken described itself as 'financially vulnerable'.
Only around 200 firms have secured full licenses under MiCA, with analysts expecting the licensing regime to thin out the crypto market. Knaken's collapse illustrates the pressure mounting on exchanges that failed to adapt.
Frequently asked questions
Why can't Knaken customers access their crypto?
Knaken has been offline since early June and stopped paying customers out. Prosecutors are seeking to wind up the platform through bankruptcy, after which a court-appointed trustee would decide what assets can be returned to customers and creditors.
Did Knaken have a license to operate?
No. Knaken operated without obtaining a required license from the Dutch markets regulator, the AFM. The Netherlands closed its grace period for crypto platforms a year ago, and Europe's MiCA licensing regime will fully expire its transition period on July 1.
Is there a criminal investigation?
Yes. The Fiscal Information and Investigation Service (FIOD) is conducting a criminal probe into possible offenses at Knaken. On Monday, investigators carried out searches, seized laptops and phones, and confiscated company assets.
