Dutch prosecutors have sold the cryptocurrency seized from collapsed platform Knaken for €2.2 million, roughly $2.5 million, according to court-appointed trustee Carl Hamm.

Thousands of customers who deposited an estimated €10 million to €12 million could now face heavy losses, underscoring how the way a crypto platform records balances can matter as much as the tokens on hand when a firm fails.

The only money in the estate so far

Hamm, the Rotterdam trustee overseeing the wind-down, said he is still investigating whether cash is held elsewhere, whether anyone owes Knaken money, and whether other assets can be sold.

Apart from the customers, he said, there are hardly any other creditors, with the possible exception of a portion of unpaid payroll tax.

Hamm wrote to roughly 6,300 people who recently held a position with the firm, warning them not to expect much of their money back.

His estimate that Knaken took in €10 million to €12 million from customers exceeds what the sale generated, pointing to a shortfall of several million euros.

In July, Cryptopolitan reported that prosecutors put the missing sum at around €7 million and the customer base at roughly 30,000 users.

The app allowed people in the Netherlands to buy, trade, and store crypto. It never held the license required by the Dutch Authority for the Financial Markets.

On July 16, a Rotterdam court declared Knaken Cryptohandel B.V. and its related Stichting Knaken Payments bankrupt.

Hamm described how the service was structured. If a customer put €100 into Bitcoin, €1 went to Knaken as a fee, while the firm used the remaining €99 to open a position on an exchange.

That position was held in Knaken's name. Customers saw their crypto balance rise in the app, but what they actually owned was a claim on the value in euros — not the coins themselves. Many assumed the tokens belonged to them.

Hamm said Knaken does not appear to have held crypto matching the balances shown to users, and that trading and day-to-day costs had long flowed into "one pot" while the business lost money.

€2.3 million routed to the owner's own company

Owner Ronald J. transferred €2.3 million from a company account to a firm he controlled. The court described the transfer as a conflict of interest.

The records trace Knaken's troubles back to 2020, when 23 bitcoins were stolen in a hack. J. blamed the theft for losses running into many millions of euros. The stolen coins were worth about €140,000 at 2020 prices.

In the years that followed, the company signed sponsorship deals with football clubs including Feyenoord, Sparta, Heracles, and Heerenveen, and briefly Ajax.

It continued to sell certificates and to accept loans from customers. It did not report its financial problems to central bank supervisor De Nederlandsche Bank.

One of the customers' lawyers challenged the justice officials' right to liquidate the holdings. "Whose crypto was it?" he asked, comparing the situation to a garage going bankrupt and selling a car left parked there while its owner sees "nothing of it."

Prosecutors say there were good reasons for the sale but have declined to elaborate. They most likely invoked Article 117 of the Dutch Code of Criminal Procedure, which allows the sale of seized goods susceptible to depreciation.

Crypto prices are volatile, Hamm noted, and had the coins not been sold and prices then fallen, the shortfall would only have widened.

Owner disputes the trustee's account

Ronald J. said he does not accept the €10 million to €12 million figure and cannot explain how it was calculated.

Knaken operated as a broker, he said: the customer placed a buy order, it was filled at the going rate, and the matched position ended up in that customer's account.

He called Hamm's suggestion that the money was never actually put into crypto "pertinent onjuist" — patently incorrect — and damaging.

He added that every order went through the firm's liquidity provider and carried an order ID, an executed price, and a timestamp that could be checked against the customer's instruction.

J. also said he is still working toward a settlement with creditors that, in his view, could speed up the wind-down.

A separate criminal investigation by the Dutch fraud agency FIOD remains open. FIOD raided the premises on June 29, seizing devices and assets, but made no arrests.