Nike Faces Lawsuit Over NFT Project Shutdown

Nike, one of the world’s most famous sports brands, is now facing a lawsuit from customers who bought its digital collectibles, known as NFTs. The lawsuit comes after Nike decided to shut down its virtual shoe project, RTFKT, which it had acquired during the NFT craze in 2021.

Back in 2021, NFTs (non-fungible tokens) were all the rage. Companies and celebrities rushed to create and sell digital items, hoping to cash in on the hype. Nike joined the trend by buying RTFKT, a company known for its “digital shoes” and virtual collectibles. The idea was to blend sneaker culture with the digital world, offering fans unique items like the Cryptokicks IRL—a physical sneaker released under the RTFKT brand.

However, the excitement didn’t last. In December 2024, Nike announced on RTFKT’s X (formerly Twitter) account that it would wind down RTFKT operations by the end of January 2025. Since then, the project has been mostly silent, with only one person, Samuel Cardillo, appearing to maintain the brand. Recently, there was even confusion when artwork for RTFKT’s CloneX NFT project suddenly disappeared and then reappeared online.

Image: RTFKT.

A group of people who bought Nike’s NFTs are now suing the company in New York’s Eastern District court. They claim that Nike’s decision to shut down RTFKT left them with digital assets that lost their value overnight. The lawsuit accuses Nike of “pulling the rug out from under them” and says that buyers would not have purchased the NFTs if they had known they were “unregistered securities.”

The proposed class action lawsuit is seeking more than $5 million in damages, citing violations of consumer protection laws in New York, California, Florida, and Oregon. The buyers argue that Nike’s actions were unfair and that the company should have been more transparent about the risks involved.

The bigger picture: NFTs and uncertainty

Nike’s NFT troubles are not unique. Other big brands, like Starbucks with its Odyssey project, have also struggled to make NFTs work in the long run. The NFT market has cooled off since its peak, and many buyers are now questioning the value and security of their digital purchases.

This lawsuit highlights the risks of investing in digital assets, especially when companies change direction or abandon projects. It also raises questions about how NFTs should be regulated and whether they count as securities under the law.

For now, Nike has not commented on the lawsuit. As the case moves forward, it could set an important precedent for how companies handle digital collectibles and the promises they make to their customers.

The story of Nike and RTFKT is a reminder that in the fast-moving world of tech and digital trends, not every gamble pays off—and sometimes, customers are left holding the bag.