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

Nike is confronting a $5 million class-action lawsuit following the abrupt shutdown of its RTFKT digital collectibles platform. Investors allege the sportswear giant executed a ’rug pull’ by discontinuing the NFT project without warning in December 2024, causing their digital asset holdings to plummet in value.

The plaintiffs, led by Australian resident Jagdeep Cheema, claim Nike failed to disclose that the NFTs constituted unregistered securities. Had investors known the company could abandon the project unilaterally, they argue they wouldn’t have purchased the tokens at their original valuations.

This legal challenge emerges as regulatory scrutiny intensifies around celebrity-endorsed and corporate NFT ventures. The case may establish precedent for investor protections in web3 projects launched by traditional enterprises.