Core Insights - The UK Serious Fraud Office (SFO) has initiated its first significant enforcement action in the cryptocurrency sector by arresting two individuals linked to the $28 million collapse of Basis Markets, a decentralized hedge-fund project that disappeared in 2022 [1][4][8] Investigation Details - The SFO, in collaboration with local police, conducted coordinated raids in Herne Hill, south London, and Bradford, West Yorkshire, resulting in the arrest of a suspect in his thirties and another in his forties on suspicions of fraud and money laundering [3][4] - No charges have been filed yet, and the SFO has characterized the case as a "suspected fraud," indicating that the investigation is still ongoing [4] Basis Markets Overview - Basis Markets was launched in late 2021, promising high returns through a decentralized hedge fund utilizing arbitrage strategies typically reserved for institutional investors [5] - The project raised approximately $7 million by selling a membership NFT collection and secured an additional $20.7 million through a public sale of its BASIS token, totaling over $28 million [6][8] - Investors were promised profit-sharing opportunities and governance rights, but funds were allegedly diverted to the founders' personal wallets instead of being allocated to a project treasury [7][8]