In a twist that feels straight out of a digital Wild West showdown, a class action lawsuit has hit Nike over its now-defunct NFT venture, RTFKT, leaving investors fuming and filing claims in Brooklyn federal court.
Led by plaintiff Jagdeep Cheema, a group of global buyers is seeking $5 million in damages, claiming Nike pulled a sneaky “rug pull” by shutting down the platform in December 2024.
Imagine buying a shiny digital sneaker only to find it vanishing like a magician’s trick— that’s how these investors feel, as their NFTs lost all value overnight.
Imagine buying a shiny digital sneaker that vanishes like a magician’s trick, leaving investors reeling as their NFTs lose all value overnight.
Technically, the suit alleges Nike violated consumer protection laws in states like New York and California by failing to warn users, turning what was supposed to be a fun blockchain adventure into a costly mess.
At its core, the lawsuit accuses Nike of selling these NFTs as unregistered securities, which is like peddling lemonade without a permit in a regulatory storm.
Think of it as a high-stakes game where Nike hyped up RTFKT’s digital fashion world—merged with gaming and blockchain—only to abruptly end the party.
Back in 2021, Nike snapped up RTFKT, and by its peak, the venture raked in $168 million from avid collectors trading these assets online.
But when support vanished, NFTs stopped working properly, leaving holders with what amounts to digital dust.
Investors now report losses in the hundreds of thousands, as tokens that once sparkled turned worthless.
It’s like investing in a blockbuster movie that gets canceled mid-shoot—exciting at first, but devastating when the credits roll early.
The case spotlights murky NFT regulations, questioning whether these assets need securities oversight, potentially sparking more lawsuits and corporate caution.
For instance, images of the Clone X series were replaced with holding page messages from Cloudflare, further frustrating affected users.
Nike, based in Oregon, hasn’t commented officially as of April 2025, though they’ve hinted at pursuing other digital paths, and this situation is exacerbated by the 60% crypto decline that has impacted the broader market.
Unlike cryptocurrencies which are fungible, these digital collectibles were marketed as unique digital certificates of ownership with distinct metadata that couldn’t be replicated.
This drama underscores the Wild West vibe of NFTs, where hype meets reality in a head-on collision—fun to watch, but ouch for those involved.
