Knaken Cryptohandel B.V. Bankruptcy Raises Concerns Over Missing Customer Funds

Knaken Cryptohandel B.V., a Dutch crypto exchange, was declared bankrupt by the Rotterdam District Court on July 16. This decision means that thousands of customers are now at risk of losing their funds.

The court's ruling is based on an investigation into Knaken's financial dealings, which revealed significant discrepancies in customer balances and unexplained transactions. According to court documents, approximately €5 million to €5.5 million ($5.7 million to $6.3 million) is missing from customers' accounts.

The exchange initially attributed the shortfall to a 2020 hack that allegedly resulted in the theft of 23 Bitcoin. However, even accounting for Bitcoin's price appreciation since 2020, this would only cover at most €1.5 million to €2 million ($1.7 million to $2.3 million) of the present-day gap.

This leaves a significant portion of the shortfall unexplained, with at least €3 million to €3.5 million ($3.4 million to $4.0 million) remaining a mystery. The court has ordered an independent investigation into Knaken's financial dealings and the fate of customer funds.