Nike Faces $5 Million Lawsuit from NFT Buyers After Shutting Down Its RTFKT Unit

After the global footwear and apparel giant closed its RTFKT (pronounced artifact) unit in December 2024, it is now facing a $5 million lawsuit

Nike is facing a $5 million lawsuit from a group of people who bought its non-fungible tokens, according to a Friday report by Reuters.

The lawsuit, a class action, was filed in Brooklyn, New York federal court and saw the purchasers allege that the closure of Nike’s RTFKT unit caused the demand for their NFTs to dry up.

The complaint, which was filed against the global footwear and apparel giant on Friday, also names RTFKT co-founders Guillaume (Ben) Bonnefont and Alexandre (DJ PELEW) Pelletier as defendants.

The report comes at a time when NFT transaction volumes have fallen to record lows despite the recent surge in the crypto market. A handful of other mainstream brands and crypto companies have also closed their NFT projects including Starbucks and DraftKings, while X2Y2, at some point was one of the biggest NFT marketplaces said it is pivoting to crypto AI.

However, not all believe that the current state of the NFT market spells curtains for the industry, with Solana-based decentralized exchange platform Jupiter consolidating its strategy for the crypto industry with the acquisition of digital collectibles platform DRiP Haus.

The NFT market fell 24% in the first quarter of 2025 to $1.5 billion compared to the preceding quarter, according to a DappRadar report. However, the number of sales was down 10%, implying a substantial decline in the average price for NFTs sold versus the quantity.

The $1.5 billion trading volume recorded between January and March 2025 is just a fraction of the $5.7 billion recorded for the final week of January 2022, when the industry was at its peak, as per Token Terminal data.

The Token Terminal also shows that whilst NFT trading volume fell by 24% in the most recent quarter compared to Q4 2024, there was a significant improvement over the past two quarters when compared to the preceding two.

That surge was linked to the general positivity surrounding the crypto market in the wake of President Trump’s election. But even such optimism could not prevent Nike from implementing its previously rumored course of action of shutting down RTFKT.

In December, RTFKT announced via Musk’s X platform that it was winding down its NFT business. In January, the company concluded its creative journey with the launch of the MNLTH X Blade Drop, released in collaboration with the 3D-printing footwear manufacturer Zellerfeld.

Last week, images of CloneX NFTs on the NFT marketplace OpenSea disappeared after Cloudflare downgraded the account responsible for serving the files. The CloneX NFT collection is one of the biggest by sales volume in RTFKT’s portfolio with 470,434.88 ETH, according to CoinMarketCap data.

At the peak of the NFT boom, Nike was reported to be the best-performing mainstream brand in the industry, generating $185 million from NFT sales as of June 2022.

Just over two and a half years down the line, and nearly four months after news that RTFKT was shutting down, the company is now facing a $5 million lawsuit from a group of people who purchased its NFTs.