U.S. securities class action filings increased in the first half, according to a new report from Cornerstone Research and the Stanford Law School Securities Class Action Clearinghouse.
The volume of filings rose by 23% compared with the second half of 2022, with 114 cases filed in the first six months of 2023, the report said.
Turmoil in the U.S. banking sector generated six class actions in the first half, it noted, and there were 11 cases filed involving the crypto sector.
“We continue to see a high level of cryptocurrency-related securities class action filings,” said Alexander “Sasha” Aganin, senior vice-president with Cornerstone Research, in a release.
“If this pace continues through the rest of the year, it is likely that the total number of cryptocurrency filings will near the record high seen in 2022,” he added.
Like the sector itself, legal action in the crypto sector remains an evolving phenomenon.
“The next few months could witness important developments in the world of securities litigation,” said Joseph Grundfest, professor with Stanford Law School and a former commissioner at the U.S. Securities and Exchange Commission.
“A district court’s very recent decision holding that Ripple’s XRP token is a legal shape-shifter — sometimes it is a security subject to federal securities law and sometimes it isn’t — will likely be appealed and is sure to generate important appellate precedent,” he said.