Maksim Zaslavskiy is facing securities fraud charges over money he raised through an initial coin offering. As Fast Company wrote last month:
Authorities claim Zaslavskiy scammed investors through two ICOs–REcoin and another, DRCWorld, that promised profits off diamonds. Participants used both credit cards and cryptocurrencies to invest in Zaslavskiy’s projects–but there’s no evidence that a token or digital asset was ever actually issued to any of those investors or that Zaslavskiy was even running his ICOs and their “smart contracts” and “secure transactions” with blockchain technology.
Now Zaslavskiy is facing a court battle. One of his defenses focuses on whether or not what he sold were actually “securities.” According to Zaslavskiy, they were not. In court yesterday, his lawyers argued to a judge that “cryptocurrencies are in a novel class . . . It’s very difficult to apply securities laws to this asset,” reports Bloomberg. They pointed to a previous ruling that said bitcoins were commodities. The judge rebutted by asking “Is it possible that it’s both?”
No decision, however, was made. Though the judge was very critical of Zaslavskiy’s claims, he set a trial date for January 7, 2019, when a jury will decide.
You can read all about Zaslavskiy’s scheme and the uncharted territory of ICOs here.