The United Kingdom’s Serious Fraud Office (SFO) has made its first major move into crypto enforcement, arresting two men allegedly tied to the $28 million collapse of Basis Markets, a decentralized hedge-fund project that vanished along with investor money in 2022.
Key Takeaways:
- The UK SFO made its first major crypto enforcement move by arresting two men linked to the $28M Basis Markets collapse.
- Basis Markets raised over $28M through NFTs and tokens before diverting funds to personal wallets.
- The project delivered no product, vanished in 2022, and left investors empty-handed.
The SFO confirmed that officers, working alongside local police, carried out coordinated raids in Herne Hill, south London, and Bradford, West Yorkshire, taking one suspect in his thirties and another in his forties into custody on fraud and money-laundering suspicions.
SFO’s First Major Crypto Probe Begins With Basis Markets Investigation
No charges have been filed yet, and the SFO described the case as a “suspected fraud,” noting that the investigation is ongoing.
However, the action marks the agency’s first large-scale crypto case.
“With our expanding cryptocurrency capability and growing expertise in this area, we are determined to pursue anyone who would seek to use cryptocurrency to defraud investors,” SFO director Nick Ephgrave QPM said in a statement.
Basis Markets launched in late 2021 with lofty promises. According to findings by independent research group Crypto Sleuth Investigations, the team behind the project marketed themselves as seasoned professionals boasting more than 80 years of combined experience in finance, software development, and crypto infrastructure.
They pitched a decentralized hedge fund that could generate “delta-neutral” returns through arbitrage strategies traditionally reserved for institutional traders.
The project sold out a membership NFT collection, raising 32,000 SOL, roughly $7 million at the time, and later conducted a public sale of its BASIS token, securing an additional $20.7 million in USDC.
#Breaking: Two men have been arrested on suspicion of fraud and money laundering as part of a new SFO crypto investigation into Basis Markets.
SFO searches of residential properties in London and Yorkshire are ongoing.
Read more online: https://t.co/JoxTbzEsah pic.twitter.com/fbno5V2Xe2— Serious Fraud Office (SFO) (@UKSFO) November 20, 2025
NFT holders were promised access to profit-sharing opportunities, while token buyers were told they would receive performance fees and governance rights in the future Basis Markets pool.
Despite promises that both NFT and token proceeds would flow into a project treasury with locked team allocations, investigators found that the funds were diverted directly into the founders’ personal wallets.
No functioning product was delivered, even as the founders flaunted luxury watch purchases in the project’s Discord community.
Basis Markets once projected it could reach over $1 billion in TVL within a year, and early pitch decks suggested a single NFT, priced around $1,880, could return as much as $18,000 per month by year three.
The team later revised the figure to a still-ambitious $30,000 cumulative, but by mid-2022 the project abruptly halted operations, claimed regulatory obstacles, and disappeared, returning nothing to investors.
UK Uncovers Billion-Dollar Crypto Laundering Network
As reported, the UK’s National Crime Agency has uncovered a vast money-laundering network that funneled billions in criminal cash into cryptocurrency to help sanctioned Russian entities evade restrictions and support the war in Ukraine.
Working with authorities in the US, France, Spain and others, the NCA has arrested 128 suspects and seized more than £25 million ($33 million) in cash and crypto in Britain as part of Operation Destabilise, the agency’s largest crackdown targeting “cash-to-crypto” laundering pipelines.
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