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

ZkProver · 2026-03-30T02:36:39+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

2026-03-30 02:36:39

Abstract generation in progress

ChainCatcher message: A federal judge in the Southern District of New York, Lewis Kaplan, has ruled to deny the motion to dismiss filed by the defendants in the TradeAI/Stakx case. The case will continue to move forward.

The lawsuit was brought by the crypto law firm Burwick Law. It alleges that multiple defendants, using NFTs and cryptocurrency investment pools as the vehicle, operated a fraud scheme purportedly of a Ponzi nature, promising investors high returns. It is currently estimated that losses have already exceeded $20 million, with an overall scope of approximately $440 million. The court rejected all of the defendants’ arguments regarding jurisdiction, venue, and service procedures, among other issues.

Regarding the defendant Cyrus Abraham’s refusal to respond on the grounds of technical defects in service, the judge made it clear that litigation procedure is not a game of hide-and-seek. Abraham was ordered to disclose to the plaintiff’s law firm his current residential address by March 31, or he will face a default judgment and additional sanctions. The court also extended the official service deadline to April 22, and has allowed legal documents to be served via alternative methods such as an Ethereum wallet, email, and social media.

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