UK authorities have launched a major criminal investigation into Basis Markets, a cryptocurrency project that raised $28 million from investors before collapsing just months later.
Key Takeaways
- The Serious Fraud Office (SFO) is investigating Basis Markets, a crypto scheme that raised $28 million in 2021 through NFT and token sales.
- Two men were arrested during police raids in London and West Yorkshire, suspected of fraud and money laundering.
- Investors were told the project failed due to US regulations, but authorities are questioning that explanation.
- This marks the SFO’s first major crypto case, part of its expanding efforts to tackle digital asset fraud.
What Happened?
The SFO revealed it has opened an investigation into Basis Markets after the platform abruptly shut down in 2022, leaving investors with worthless digital assets. The inquiry follows two fundraising rounds in late 2021 where the firm promised to build a crypto hedge fund using capital raised from NFT and token sales.
#Breaking: Two men have been arrested on suspicion of fraud and money laundering as part of a new SFO crypto investigation into Basis Markets.
— Serious Fraud Office (SFO) (@UKSFO) November 20, 2025
SFO searches of residential properties in London and Yorkshire are ongoing.
Read more online: https://t.co/JoxTbzEsah pic.twitter.com/fbno5V2Xe2
UK Launches Investigation into Failed Crypto Hedge Fund
The Serious Fraud Office confirmed it is investigating Basis Markets as a “suspected fraudulent operation”, not a registered company. The investigation centers around how the scheme attracted retail investors with promises of low-risk arbitrage returns during the peak of the crypto boom.
On November 20, the SFO, supported by the Metropolitan Police and West Yorkshire Police, raided properties in Herne Hill, London and near Bradford. Two men, one in his 30s and the other in his 40s, were arrested on suspicion of multiple counts of fraud and money laundering.
The project raised about $28 million across two public fundraisers, one in November 2021 via NFT sales and another in December 2021. The funds were marketed as seed capital for a crypto hedge fund.
By June 2022, however, investors were informed the project could not proceed due to proposed new US regulations. The SFO is now investigating whether this regulatory explanation was legitimate or used as a pretext to shut down the operation and potentially misappropriate funds.
Investors Left With Valueless NFTs
Investors reportedly received non-fungible tokens and platform tokens that are now considered worthless. With little formal oversight or transparency during the fundraising process, many investors were left without recourse as the project unraveled.
Authorities are now working to track the flow of funds and determine how the money was handled. The investigation will assess whether Basis Markets misled investors and diverted funds for purposes other than what was promised.
SFO Strengthens Crypto Capabilities
This case is the SFO’s first major investigation involving cryptocurrency, marking a turning point in how UK regulators approach crypto fraud. Earlier this year, the SFO secured more than £8 million in funding to bolster its crypto enforcement unit, allowing for improved asset tracking and cross-border cooperation.
Nick Ephgrave, Director of the SFO, said:
He described the arrests and searches as “an important step” and urged anyone with information about Basis Markets to assist in the investigation.
Solicitor General Ellie Reeves echoed this message, noting:
CoinLaw’s Takeaway
In my experience, when a crypto project suddenly vanishes after raising millions, red flags are always flying in hindsight. Basis Markets lured people in during a frenzy of digital hype, only to vanish with no clear answers. What really gets me is how common this pattern has become. A fancy name, vague promises of hedge-fund-level returns, and NFTs with no intrinsic value? It’s a formula we’ve seen too often.
I found the SFO’s active pursuit reassuring, especially because so many of these cases never get formal attention. It shows that UK authorities are finally treating crypto fraud as a serious crime, not just a tech hiccup. This investigation might finally bring some accountability to a space that’s sorely needed it.
