This bit of the output seems to be the core of it:

Jul 08 09:51:08 autopkgtest systemd[1]: dev-loop2.device: Job 
dev-loop2.device/start timed out.
Jul 08 09:51:08 autopkgtest systemd[1]: Timed out waiting for device /dev/loop2.
Jul 08 09:51:08 autopkgtest systemd[1]: Dependency failed for Squashfs mount 
unit for basic-service.
Jul 08 09:51:08 autopkgtest systemd[1]: snap-basic\x2dservice-100001.mount: Job 
snap-basic\x2dservice-100001.mount/start failed with result 'dependency'.
Jul 08 09:51:08 autopkgtest systemd[1]: dev-loop2.device: Job 
dev-loop2.device/start failed with result 'timeout'.

Seems pretty incomprehensible though. Why would anything time out
waiting for /dev/loop2 ?

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https://bugs.launchpad.net/bugs/1599799

Title:
  snapd > 2.0.2 fails on yakkety

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