Nike is facing a class-action lawsuit accusing it of operating a “rug pull” after shutting down its non-fungible token (NFT) platform, RTFKT, earlier this year. Filed in a Brooklyn federal court on April 25, the lawsuit, led by RTFKT user Jagdeep Cheema, alleges that Nike promoted its sneaker-themed NFTs to attract investors before abruptly shuttering the platform, causing “significant damages” to holders. Allegations by Plaintiffs The plaintiffs claim the NFTs qualify as unregistered securities, arguing that Nike leveraged its powerful brand and marketing reach to promote these digital assets without properly registering them with the Securities and Exchange Commission (SEC). According to the suit, investors were led to believe the value of their NFTs would rise alongside RTFKT’s success, driven by Nike’s ongoing support and marketing efforts. The lawsuit seeks $5 million in damages, accusing Nike of violating consumer protection laws and engaging in unfair trade practices. While U.S. courts have yet to clearly define whether NFTs are securities, the group contends that the court doesn’t need to settle that question to move forward with the case. Meanwhile, companies like OpenSea have urged the SEC to exempt NFTs from federal securities laws, arguing that they do not meet the traditional definitions of a security. Nike’s involvement in the NFT space began with its 2021 acquisition of RTFKT Studios , known for creating virtual sneakers. Initially, the Nike NFTs were promoted as assets that could be traded on secondary markets and used to unlock rewards through various challenges and quests. RTFKT Shutdown Leaves NFT Holders with Heavy Losses At the height of the hype in April 2022, some NFTs from Nike’s collection were trading for an average of 3.5 Ether, roughly $8,000 at the time. However, by April 2025, after Nike shut down RTFKT, the same NFTs were selling for just around 0.009 Ether, or around $16, according to OpenSea data. The lawsuit claims that the platform’s closure erased not only the monetary value of the NFTs but also the promised experiences tied to them, which were key selling points for buyers. The broader NFT market has also been under pressure . Sales volume plunged 63% year-over-year in the first quarter of 2025, dropping from $4.1 billion to just $1.5 billion. The collapse in the NFT sector, coupled with Nike’s withdrawal, has left many early supporters questioning the future viability of branded NFT initiatives. The post Nike Faces Class-Action Lawsuit Over RTFKT NFT Platform Shutdown appeared first on TheCoinrise.com .
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