Nike faces five million dollar lawsuit over closure of crypto business
RTFKT. Credits: Nike // RTFKT. Nike is facing a proposed class action lawsuit in regards to the closure of its cryptocurrency business, RTFKT. Plaintiffs in the case are accusing the sportswear giant of leaving them with significant losses after the platform’s shuttering caused demand for their non-fungible tokens (NFTs) to wane. Filed with the Eastern District of New York, the class action is being led by Australia-based Jagdeep Cheema, who is seeking unspecified damages amounting to more than five million dollars, Reuters reported. According to the plaintiffs, they would never have bought RTFKT’s NFTs had they known they were “unregistered securities”, and as such Nike caused “the rug to be pulled out from under them”. Nike had acquired virtual sneaker and fashion platform RTFKT in December 2021 as part of a wider digital transformation, and at a time when NFTs were at the height of popularity. Founded in 2020, RTFKT reported a total revenue of 49.82 million dollars just two years into its lifespan, and had reportedly sold around 3.1 million dollars worth of virtual sneakers at its peak. Just three years later, however, Nike ended up shutting down the business as interest in digital assets began to wane and the sportswear brand pivoted its focus towards product innovations and wholesale relations. The company reaffirmed at the time that, despite its closure, the platform would serve as a “symbol of a cultural revolution”. FashionUnited has contacted Nike with a request to comment.
Nike is facing a proposed class action lawsuit in regards to the closure of its cryptocurrency business, RTFKT. Plaintiffs in the case are accusing the sportswear giant of leaving them with significant losses after the platform’s shuttering caused demand for their non-fungible tokens (NFTs) to wane.
Filed with the Eastern District of New York, the class action is being led by Australia-based Jagdeep Cheema, who is seeking unspecified damages amounting to more than five million dollars, Reuters reported. According to the plaintiffs, they would never have bought RTFKT’s NFTs had they known they were “unregistered securities”, and as such Nike caused “the rug to be pulled out from under them”.
Nike had acquired virtual sneaker and fashion platform RTFKT in December 2021 as part of a wider digital transformation, and at a time when NFTs were at the height of popularity. Founded in 2020, RTFKT reported a total revenue of 49.82 million dollars just two years into its lifespan, and had reportedly sold around 3.1 million dollars worth of virtual sneakers at its peak.
Just three years later, however, Nike ended up shutting down the business as interest in digital assets began to wane and the sportswear brand pivoted its focus towards product innovations and wholesale relations. The company reaffirmed at the time that, despite its closure, the platform would serve as a “symbol of a cultural revolution”.
FashionUnited has contacted Nike with a request to comment.
