A federal judge in New York has ruled that the Initial Coin Offerings or ICOs are securities and that the related scams can be booked under US securities laws.
The ruling by U.S. District Judge Raymond Dearie gives more power to US Securities and Exchange Commission, which is cracking down cryptocurrencies and ICOs as part of its efforts to regulate the industry.
As per the verdict, the SEC can proceed with its legal case against a man charged with promoting cryptocurrencies backed by investments in real estate and diamonds, which didn't exist, according to prosecutors.
The case, which is said to be the first criminal prosecution of its kind, involves Maksim Zaslavskiy, the organizer of RECoin and DRC ICO. He argued that the ICOs at issue were not securities but instead currencies and that there is no legal ground for the investigation by SEC.
However, the judge disagreed with the argument and ruled that the case should go to trial, as the SEC intended.
ICOs are similar to initial public offerings, but offers cryptocurrencies. Amid the boom in cryptocurrency, many companies launched ICOs and raised a huge amount of money. However, most of these companies later claimed to be hacked or shut down, risking investors.
Bloomberg reported, citing data compiled by Coinschedule.com, that about $18.7 billion has been raised this year by ICOs. Recently, The North American Securities Administrators Association or NASAA announced that more than 200 active investigations into ICOs and cryptocurrency-related investment products have been initiated by state and provincial securities regulators in the United States and Canada.
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May 15, 2026 15:25 ET Apart from the confirmation of Kevin Warsh as the next Fed chair, the main news on the economics front this week included key price data from the U.S. and the first quarter economic growth figures from major economies. Both consumer prices and producer costs have started to reflect the effect of supply shocks due to the Middle East conflict. In Europe, GDP data was in focus, while inflation data from China dominated the news flow in Asia.