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cryptonews 2025-04-28 04:46:29

Nike Faces $5M Lawsuit Over Losses From Shuttered NFT Venture

Nike Faces $5M Lawsuit Over Losses From Shuttered NFT Venture

Nike is facing a lawsuit from a group of investors who claim the company’s abrupt shutdown of its digital collectibles venture, RTFKT, wiped out the value of their purchases and left them facing heavy losses. In a class action filed on Friday in Brooklyn federal court, Australian resident Jagdeep Cheema and other plaintiffs accused Nike of orchestrating a “rug pull” by shuttering the platform in Dec. 2024. They allege Nike’s decision caused the market for its branded non-fungible tokens ( NFTs ) and related cryptocurrency assets to collapse. The plaintiffs said they would not have purchased the NFTs at the prices they did, or at all, had they known the tokens were unregistered securities and that Nike could abandon the project without warning. Nike Faces $5M Lawsuit Over NFT Shutdown #Nike is being sued in New York for $5 million after abruptly closing its digital sneaker #NFT project, #RTFKT , in December 2024. Investors claim Nike violated consumer protection laws by: Selling unregistered NFT securities. Lacking… pic.twitter.com/9rcWdWhwCr — Briefing Block (@briefing_block_) April 27, 2025 Nike, which is based in Beaverton, Oregon, has not yet commented on the lawsuit. Nike’s Digital Ambitions Hit a Roadblock After RTFKT Closed The sportswear giant entered the NFT space in 2021 when it acquired RTFKT, a digital fashion and collectibles brand that merged gaming, culture and blockchain technology. The company promoted the acquisition as a push into next-generation innovation. At its height, RTFKT’s NFTs generated around $168m in sales, fueled by Nike’s marketing power and growing excitement around digital ownership. However, the momentum faded. Nike announced RTFKT’s winddown on Dec. 2, 2024, saying that the spirit of innovation would continue through creators and projects inspired by the brand. Nike Faces Heat Over Alleged Failure to Disclose NFT Risks Investors argue that Nike’s closure of RTFKT blindsided them. They claim the company failed to disclose regulatory risks tied to NFTs. Moreover, they point out that the legal classification of NFTs under US securities law remains unsettled. The lawsuit seeks more than $5m in damages. It cites alleged violations of consumer protection laws in New York, California, Florida, and Oregon. In addition, the case raises broader questions about how brands should approach Web3 ventures as regulatory scrutiny over digital assets continues to intensify. The post Nike Faces $5M Lawsuit Over Losses From Shuttered NFT Venture appeared first on Cryptonews .

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