Britain's Serious Fraud Office arrested two men in London and Bradford on November 20, marking the agency's first major criminal enforcement action in a cryptocurrency fraud case. The suspects face allegations connected to Basis Markets, a defunct venture that raised $28 million through two NFT-based fundraisers in late 2021 before collapsing the following year.
What to Know:
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The SFO detained a man in his thirties in Herne Hill, London, and another in his forties near Bradford in coordinated raids with Metropolitan and West Yorkshire Police focusing on fraud and money laundering charges.
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Basis Markets collected $28 million through November and December 2021 NFT offerings before abruptly suspending operations in June 2022, citing proposed US regulations as the reason for closure.
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The arrests represent a significant expansion of UK enforcement capabilities targeting digital asset crime, with authorities establishing specialized resources and frameworks for cryptoasset recovery under the Crown Prosecution Service's Economic Crime Strategy 2025.
SFO Targets Digital Asset Fraud in Coordinated Operation
The raids occurred simultaneously across two locations, with officers focusing on evidence related to fraud and money laundering in the Basis Markets scheme. This investigation marks the first time the SFO has committed substantial resources to prosecuting cryptocurrency-related fraud.
SFO Director Nick Ephgrave confirmed the agency has developed specialized capabilities to investigate digital asset schemes.
The unit's creation reflects growing concerns about investor losses in crypto ventures that lack regulatory oversight. Authorities worked with Metropolitan Police and West Yorkshire Police to execute the operation.
Solicitor General Ellie Reeves said fraudulent crypto schemes pose a serious threat to the UK economy.
She emphasized that such activity erodes trust in financial markets. The government has pledged continued support for enforcement actions targeting digital asset fraud.
The SFO issued a public appeal for victims and whistleblowers to contact [email protected]. This outreach suggests authorities believe more victims exist beyond those who have already come forward. The case could establish legal precedents for how UK courts handle blockchain-based fraud prosecutions.
Basis Markets Raised $28 Million Before Sudden Collapse
The venture launched two NFT-based fundraisers during the late 2021 surge in digital collectible sales. The first offering in November 2021 promised investors a stake in a new crypto investment vehicle through NFT purchases. The second fundraiser followed in December 2021, with organizers pledging to create a crypto hedge fund employing advanced trading strategies.
Investor enthusiasm ran high during this period. NFT sales peaked across the market.
But the project suspended operations in June 2022, with organizers citing proposed US regulations as the reason for the shutdown.
The timing coincided with broader scrutiny from US agencies examining NFT and crypto fundraising practices. However, the $28 million raised remained inaccessible to investors after the collapse.
The project's failure also aligned with significant downturns across cryptocurrency markets in 2022, raising questions about whether regulatory changes fully explained the suspension.
NFT-based fundraising gained popularity in 2021 as projects used digital collectibles to attract capital. US Treasury research found that approximately 65 percent of NFT fraud cases involve misleading marketing. This high rate underscores the challenges facing regulators and enforcement agencies pursuing such cases.
UK Authorities Expand Crypto Crime Enforcement Framework
The investigation follows the Crown Prosecution Service's Economic Crime Strategy 2025, released in May, which designated cryptocurrency and cyber-enabled fraud as priority threats. The strategy calls for enhanced coordination between the CPS, SFO, and law enforcement agencies. Authorities have appointed operational leads specifically for cryptoasset recovery and established new cooperation frameworks.
These institutional changes signal recognition that traditional investigative tools prove insufficient for blockchain-based financial crime. The SFO's decision to prosecute crypto-related cases aligns with global trends toward stricter enforcement of digital asset fraud.
Regulators worldwide are scrutinizing fundraising methods that blur distinctions between securities, collectibles, and investments. The Basis Markets prosecution could influence how UK courts interpret and apply fraud statutes to cryptocurrency schemes.
Bitcoin Archive noted the significance of the SFO pursuing large-scale crypto prosecutions.
The case demonstrates authorities' willingness to pursue complex digital asset fraud despite technical and legal challenges. Regulatory uncertainty will not shield defendants from prosecution, according to enforcement officials.
The outcome may determine how aggressively the UK pursues future cryptocurrency crime cases. As digital asset markets evolve, this investigation could shape enforcement priorities and legal interpretations for years.
Closing Thoughts
The Basis Markets case represents a watershed moment for UK crypto enforcement. The SFO's commitment of resources to this investigation signals that authorities view digital asset fraud as a serious economic threat requiring specialized prosecution capabilities. How courts rule on the charges could establish important precedents for future cases involving NFTs and cryptocurrency fundraising schemes.