Knaken bankruptcy puts customer recovery under court control

Dutch exchange users often assume a displayed balance reflects assets that can be returned. Knaken's collapse shows that may not hold when records, custody, and actual reserves do not line up.

A Rotterdam court placed Knaken Cryptohandel B.V. and Stichting Knaken Payments into bankruptcy on July 16 after finding the exchange could not fully repay customers. Prosecutors told the court that about EUR7 million was missing from customer balances. Customers were already locked out, payments had stopped, and the court said the coverage shortfall had not been disclosed. Trustee C.F.W.A. Hamm now controls both entities and will run the wind-down.

Knaken had argued for its own payout process after an independent verification step, saying asset seizures, the service shutdown, and its custody structure already protected users. The court rejected that plan and chose an outside trustee instead. That means customer recovery will depend on a court-supervised review of wallets, bank accounts, access controls, and internal records, not the exchange's own books alone.

Dutch prosecutors also said the FIOD searched the company on June 29 and seized data carriers and company assets as part of a criminal investigation. No arrests had been made as of June 30. For customers, the next step is whether the trustee can match account balances to identifiable crypto, cash, or other property that still exists.