UK Fraud Office Conducts Initial Significant Cryptocurrency Arrests in $28 Million Basis Markets Scam

The Serious Fraud Office (SFO) of the United Kingdom has initiated its first significant action in crypto enforcement by apprehending two individuals allegedly connected to the $28 million downfall of Basis Markets, a decentralized hedge-fund initiative that disappeared along with investor funds in 2022.

Key Takeaways:

• The UK SFO has made its initial substantial crypto enforcement action by detaining two men associated with the $28M Basis Markets failure.
• Basis Markets accumulated over $28M through NFTs and tokens before misappropriating funds to personal wallets.
• The initiative failed to deliver any product, vanished in 2022, and left investors without recourse.

The SFO confirmed that officers, in collaboration with local police, executed coordinated searches in Herne Hill, south London, and Bradford, West Yorkshire, taking one suspect in his thirties and another in his forties into custody on allegations of fraud and money laundering.

SFO’s First Major Crypto Probe Begins With Basis Markets Investigation

No charges have been brought forth at this time, and the SFO characterized the case as a “suspected fraud,” indicating that the investigation remains active.

This action signifies the agency’s inaugural 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,” stated SFO director Nick Ephgrave QPM.

Basis Markets was launched in late 2021 with ambitious claims. According to research conducted by independent group Crypto Sleuth Investigations, the team behind the project presented themselves as experienced professionals with over 80 years of combined expertise in finance, software development, and crypto infrastructure.

They proposed a decentralized hedge fund capable of generating “delta-neutral” returns through arbitrage strategies typically reserved for institutional investors.

The project successfully sold out a membership NFT collection, raising 32,000 SOL, approximately $7 million at that time, and subsequently held 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 assured access to profit-sharing opportunities, while token purchasers were informed they would receive performance fees and governance rights in the future Basis Markets pool.

Despite assurances that proceeds from both NFTs and tokens would be allocated to a project treasury with locked team allocations, investigators discovered that the funds were redirected into the founders’ personal wallets.

No operational product was delivered, even as the founders showcased luxury watch acquisitions in the project’s Discord community.

Basis Markets had once projected it could achieve over $1 billion in total value locked (TVL) within a year, and early pitch materials suggested a single NFT, priced around $1,880, could yield as much as $18,000 per month by the third year.

The team later adjusted the estimate to a still-ambitious $30,000 cumulative, but by mid-2022, the project abruptly ceased operations, citing regulatory challenges, and vanished, providing no returns to investors.

UK Uncovers Billion-Dollar Crypto Laundering Network

As reported, the UK’s National Crime Agency has revealed a large money-laundering network that funneled billions in illicit cash into cryptocurrency to assist sanctioned Russian entities in evading restrictions and supporting the war in Ukraine.

In collaboration with authorities in the US, France, Spain, and others, the NCA has arrested 128 suspects and confiscated over £25 million ($33 million) in cash and crypto in Britain as part of Operation Destabilise, the agency’s most extensive crackdown targeting “cash-to-crypto” laundering channels.

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