On July 1, the Dutch Public Prosecution Service filed a bankruptcy petition with the Rotterdam District Court against crypto platform Knaken Cryptohandel and its affiliated entity Stichting Knaken Payments. Knaken has ceased operations since early June, leaving approximately 30,000 clients unable to access their held crypto assets. On the same day, the Fiscal Information and Investigation Service (FIOD) launched a criminal investigation into possible illegal activities.
Legal Basis for Bankruptcy Petition and Asset Disposal Procedures
If the Rotterdam District Court approves the petition, a court-appointed bankruptcy administrator will take over all of Knaken's assets and decide, in accordance with the law, the proportion and method of assets that can be returned to clients and other creditors. The Dutch Public Prosecution Service stated that it will not intervene in the administrator's disposal procedures.
The petition stems from the following reasons: Knaken has stopped paying compensation to clients and advised them not to file damage claims; prosecutors expressed "great concern" about the lack of order in the company's self-liquidation process; meanwhile, the AFM (Netherlands Authority for the Financial Markets) has issued warnings and received regulatory complaints.
Current Status of FIOD Criminal Investigation and Division of Civil Cases
FIOD's criminal investigation stems from signals from the AFM and complaints from regulatory bodies, aiming to determine whether illegal acts occurred. On Monday, investigators searched Knaken-related premises, seized laptops and mobile phones, and confiscated company assets. As of the time of reporting, no arrests have been made. The Dutch Public Prosecution Service emphasized that the civil bankruptcy petition and the criminal investigation are handled by separate teams, and the procedures for the two cases are independent of each other.
MiCA Transition Period Expires: Legal Status of Unauthorized Platforms
The EU MiCA transition period officially ended on July 1, 2026. After this date, platforms that have not obtained a MiCA license will not be able to legally provide cryptocurrency services to EU clients. The Netherlands ended its domestic transition period a year early.
Knaken has never obtained any license required by the AFM. Its services, including EUR-to-BTC and EUR-to-ETH exchange and crypto asset storage, all fall under MiCA regulation. Analysts point out that the market faces consolidation pressure after the tightening of MiCA, and currently only about 200 companies across Europe have obtained full MiCA licenses.
Frequently Asked Questions
What is the legal mechanism by which the Dutch Public Prosecution Service petitions for bankruptcy on grounds of "public interest"?
Dutch law allows the Public Prosecution Service to apply for a declaration of bankruptcy on civil grounds based on "public interest", even if the affected clients have not filed a petition themselves. This mechanism is used to protect collective interests, and in this case, it is used to protect approximately 30,000 Knaken clients who cannot access their crypto assets.
After the bankruptcy administrator takes over, how can Knaken clients recover their assets?
If the court approves the petition, a court-appointed bankruptcy administrator takes over Knaken's assets, evaluates them according to law, and decides the proportion and method of returning assets to clients and other creditors. The Dutch Public Prosecution Service stated it will not intervene in this process. The specific recovery mechanism and timeline will depend on the administrator's decision, and as of the time of reporting, no details have been announced.
Did Knaken have any public record of financial difficulties prior to this?
According to a report by the Dutch public broadcaster NOS, Knaken described its financial situation as "fragile" in its 2024 annual report. In addition, Knaken had sponsored Dutch football clubs such as Ajax, Feyenoord, and Sparta Rotterdam; Ajax terminated its contract after two months of cooperation, and Feyenoord also ended the partnership last year, both occurring before the company ceased operations.
