Nike faces a $5 million lawsuit for shutting down RTFKT, which allegedly resulted in NFT losses

Users of this platform claim they lost a significant number of NFTs when the shutdown occurred so quickly.

In a surprising move, a group of RTFKT (Real-Time From Kings, Together) platform users has filed a $5 million lawsuit against Nike for shutting down the NFT project.

According to the lawsuit filed on April 25 in the U.S. District Court for the Eastern District of New York, the plaintiffs claim they suffered significant NFT losses as a result of the quick shutdown.

The plaintiffs allege that Nike expressed interest in the RTFKT project and sold the NFTs with promises linked to the company’s brand and continuing success. However, they allege that Nike abandoned the project, causing the tokens to lose all value and resulting in substantial NFT losses for the plaintiffs.

What Happened?

In 2021, sportswear giant Nike acquired RTFKT Studios, a platform known for its metaverse sneakers NFTs and other digital assets.

These NFTs were advertised and sold to the public by Nike, who promised long-term benefits and rewards.

The plaintiffs' claims began with the RTFKT tokens, which were sold for 3.5 ETH (about $8,000) each at the time of the initial sale.

Image Credit: RTFKT

The lawsuit mentions that despite the high price, there was reportedly high demand for the tokens.

However, in January 2025, Nike decided to shut down RTFKT, an action that ultimately led to the plaintiffs incurring financial losses.

Why The Lawsuit?

The plaintiffs, who are yet to be named in the lawsuit, claim that the defendants sold unregistered securities in violation of state and federal law.

They also claim that the defendants engaged in unlawful trade practices and breached express and implied warranties.

They are seeking $5 million in damages for violation of consumer law and unjust enrichment.

The case does not require the court to decide whether NFTs are legally considered securities—a topic the SEC is still grappling with.

Instead, the focus is on how Nike marketed and managed the project to determine if it meets the legal definition of selling unregistered securities.

This lawsuit comes at a time when investors are battling significant NFT losses.

Earlier this year, Animoca Brands, a major Web3 investment firm, also reported staggering losses, highlighting the prevalent risks in the nascent industry.

As this case progresses, it will be interesting to see how the court holds companies accountable for their actions in the Web3 space.