Creditor Takes Crypto Startup London Block Exchange to Court

A creditor has taken the London Block Exchange to court in a bid to wind up the cryptocurrency exchange, but the startup's CEO has denied it is going out of business.

Law firm Squire Patton Boggs LLP served the petition to LBX on March 19 in London's High Court of Justice.

A hearing on the matter is scheduled to take place Tuesday, according to London Block Exchange CEO Benjamin Dives.

Typically a creditor asks a solicitor to wind the debtor company up to recover debts, or to stop the company from making its debts worse.

According to him, LBX sent the money to the firm, but it somehow never reached Squire's account.

LBX had been based in the iconic Level39 tech space in London's Canary Wharf, which had been home to a number of crypto and blockchain firms, including the CEX.IO exchange, eToro and Revolut.

The London Block Exchange launched in November 2017 having raised 2 million pounds from investors, according to Business Insider.

That turned out to be a case of bad timing, since telco services provider WaveCrest violated its terms with Visa, essentially putting an end to this business model in the U.K. However, LBX pivoted to become a mobile-first crypto exchange on iOS and Android, courting U.K. customers looking to trade crypto for pounds sterling.

Towards the end of 2018, LBX announced it was "Minting" a digital pound via a partnership with another blockchain company, AlphaPoint.

Reuters reported a deal between LBX, which is regulated by the Financial Conduct Authority and ClearBank to provide the exchange with banking services.