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The Southern District of New York recently certified a class action involving allegations of market manipulation in the cryptocurrency sector. Judge Katherine Polk Failla’s certification order addresses one of the key challenges in this type of litigation: the intersection between limits on the extraterritorial application of U.S. regulatory law and the requirements for class certification under Rule 23(b).

Background

The plaintiffs in In re Tether & Bitfinex Crypto Asset Litigation are purchasers of Bitcoin and other cryptocurrencies, as well as cryptocommodity futures. They sued a group of defendants involved with Tether, the issuer of a stablecoin called “USDT,”…