TradeAI/Stakx Ponzi scheme case dismissal request rejected, involving a scale of $440 million

ZkProver · 2026-04-07T03:46:10+00:00

The judge of the Southern District of New York Federal Court dismissed the defendant's motion to dismiss in the TradeAI/Stakx case, and the case will proceed. The case involves a Ponzi scheme disguised as NFT and cryptocurrency investments, with losses exceeding $20 million. The defendant is required to disclose their address; failure to do so will result in a default judgment.

ZkProver

2026-04-07 03:46:10

Abstract generation in progress

ChainCatcher message: U.S. District Judge Lewis Kaplan for the Southern District of New York ruled to deny the motion to dismiss filed by the defendants in the TradeAI/Stakx case. The case will continue to move forward.

The case was brought by the cryptocurrency law firm Burwick Law. It alleges that multiple defendants used NFTs and cryptocurrency investment pools as vehicles to operate a purported Ponzi-scheme-style fraudulent plan, promising high returns to investors. It is currently estimated that losses have already exceeded $20 million, and the total amount at issue is about $440 million. The court rejected all of the defendants’ arguments regarding jurisdiction, venue, and service procedures.

With respect to the defendant Cyrus Abraham’s refusal to answer the lawsuit on the grounds of technical defects in service, the judge clearly stated that litigation procedure is not a game of hide-and-seek. He ordered Abraham to disclose his current residential address to the plaintiff’s law firm by March 31, or he will face a default judgment and additional sanctions. The court also extended the formal service deadline to April 22, and it has already allowed service of legal documents through alternative methods such as an Ethereum wallet, email, and social media.

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