- SFO launches investigation into $28M crypto fraud case, arrests made.
- Bank of England adjusts stablecoin rules amid growing industry pressure.
- Crypto market struggles as Basis Markets collapse sparks major investigation.
The UK’s Serious Fraud Office (SFO) has launched a major investigation into the collapse of Basis Markets, a cryptocurrency project that raised $28 million before shutting down unexpectedly. The project, which had promised to create a “crypto hedge fund,” conducted two fundraising rounds in late 2021.
However, in June 2022, it announced its closure, blaming new US regulations. Investors are now questioning whether the closure was truly due to regulatory changes or a strategy to vanish with their funds.
Following the collapse, SFO investigators, aided by the Metropolitan Police and West Yorkshire Police, executed coordinated raids at properties in Herne Hill and near Bradford. Two men, aged in their thirties and forties, were arrested on charges of fraud and money laundering. The SFO has yet to disclose specific details about how the funds were spent or what caused the sudden shutdown, leaving many questions unanswered.
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Growing Concerns Over Crypto Fraud as Investigations Intensify
The SFO’s investigation marks its first major cryptocurrency-related case, underlining increasing concerns about fraud in the crypto space. The collapse of Basis Markets comes during a turbulent period for the broader crypto market, which has seen its total value drop to around $2.95 trillion.
Bitcoin and Ethereum prices have also declined sharply, triggering fear across altcoins. The SFO’s involvement signals a deeper examination of the industry’s lack of transparency and regulatory challenges.
In addition to Basis Markets, other crypto projects are also under scrutiny. World Liberty Financial has come under investigation after allegations that it sold tokens linked to North Korea’s Lazarus Group and Russian sanctions evasion.
The project’s ties to Donald Trump’s family-controlled company have raised further alarms over potential illegal activity within the sector.
Bank of England Responds to Crypto Industry Pressure with New Stablecoin Exemptions
Amidst the scrutiny of crypto projects, the Bank of England (BOE) has signaled a shift in its approach to stablecoin regulations. According to Bloomberg, the BOE plans to introduce exemptions to its proposed stablecoin holding limits, particularly for crypto exchanges that need to maintain large reserves.
Originally, individuals were capped at £20,000, and businesses at £10 million. However, the Bank may allow stablecoins to be used as settlement assets within its Digital Securities Sandbox, marking a more flexible stance in response to industry pressure.
Also Read: Peter Brandt Predicts Bitcoin Won’t Hit $200,000 Until 2029 – Here’s Why!
