Dutch Court Declares Crypto Platform Knaken Bankrupt

A Dutch court has declared Dutch cryptocurrency platform Knaken bankrupt amid allegations of fund misappropriation.

Cointelegraph reported on July 17 that the Rotterdam court issued the bankruptcy ruling after prosecutors said 7 million euros ($8.1 million) in customer assets had disappeared from the platform.

The court determined that a bankruptcy ruling was needed to proceed with settlements after blocking access to the Knaken platform and its accounts. It also said the company did not have enough assets to repay users and that customers had not received enough information to determine their legal status.

Dutch prosecutors had previously opened a criminal investigation into allegations that Knaken misappropriated funds and filed the bankruptcy petition with the court in late June. The Netherlands' financial crime investigation service also raided Knaken's offices in late June.

Founded in Rotterdam in 2017, Knaken reportedly halted services in early June. Cointelegraph said Knaken was not listed on the register of approved crypto service providers maintained by the Dutch Authority for the Financial Markets.