The Rotterdam Court of the Netherlands has ruled that the local encryption platform, Knaken, is bankrupt. According to the prosecution, approximately Euro7 million of the Platform ' s client funds could not be reconciled and existing assets were insufficient to fully reimburse the users. With the suspension of the platform in early June, the incident had escalated from an operational crisis to a parallel liquidation with a criminal investigation.

The court said there was a large funding gap.

The Court stated that Knaken had a large financial gap and that users had not been adequately informed. Public accounts indicate that a larger client fund has disappeared, but it is still not possible to explain how it actually happened.

The platform was offline in early June, when users were no longer able to access the accounts via the official network. Subsequently, at the end of June, the Dutch prosecution filed an application for bankruptcy, which was finally upheld by the court.

  • Financial implications: approximately 7 million euros
  • Processing bodies: Rotterdam Court, Dutch prosecution
  • Current status: liquidation of insolvency advances in tandem with criminal investigation

Corporate programmes were not adopted by the courts

Knaken had objected to the application for insolvency, stating that the interests of the client could also be protected by other legal means. The company also suggested that available assets in its possession could be distributed directly to users.

However, the Court considered that the programme was difficult to establish because the Platform had insufficient assets to cover all customer claims. The court therefore decided to enter into formal insolvency proceedings, with the designated administrator taking over the subsequent liquidation and recovery.

This means that the final amount of French currency and encrypted assets that the customer can recover will depend on subsequent asset verification and recovery. At this stage, the information publicly available still does not indicate the exact whereabouts of the missing funds.

The European platform accelerates fragmentation when the MiCA land

The point of Knaken ' s insolvency coincided with the completion of the transition of the EU Regulation on the Regulation of Encrypted Asset Markets, MiCA. Under the new regulations, a platform for the provision of relevant encryption services to EU clients requires authorization from the EU regulatory body.

The Netherlands ended its transition arrangements earlier, while the EU-wide MiCA transition ended on 1 July 2026. Knaken did not appear in the list of platforms authorized to continue providing the services at the time of insolvency.

The market has also accelerated its concentration with the holders. Previously, a platform that did not have the mandate of the MiCA would need to phase out relevant EU operations after the deadline and to address client protection arrangements. Meanwhile, licensed companies such as Coinbase and Ripple are expanding their European layout.

The Knaken incident further indicates that the operational pressure on the platform that failed to complete the compliance conversion under the new licensing system is rapidly rising. Once there is a parallel funding gap, the disposal space will be significantly narrowed.