Nike Shuts Down RTFKT NFT Division, Faces Lawsuit
- Nike closes RTFKT unit amid strategic refocus, $5 million lawsuit initiated.
- Nike focuses on physical products over Web3 ventures.
- NFT values dip, triggering community concern amid sweeping industry shifts.
On December 2, 2024, Nike announced the closure of RTFKT, an NFT-focused unit, inciting a $5 million lawsuit.
The shutdown exemplifies Nike's shift from digital assets, impacting NFT markets and investor confidence.
Nike Halts RTFKT Amid Financial Pressures
Nike's decision to close RTFKT follows Elliot Hill's direction towards traditional retail, facing financial pressures from declining NFT values.
RTFKT, acquired by Nike in 2021, was renowned for digital fashion and NFTs but has now announced winding down operations by January 2025. In the words of the Rosen Law Firm, "On December 2, 2024, RTFKT announced on the platform X, its plan to wind down RTFKT operations, injuring investors holding NFTs promoted by Nike."
NFT Community Faces No Compensation Plan
The shutdown affects NFT holders, with no plans for compensation announced. Community response shows disappointment and concern for lost potential.
Investors express discontent as NFT values fall, while the class-action lawsuit represents financial uncertainty and possible legal challenges for Nike. As noted by Web3 Investor, Rahim Mahtam, "This will probably be one of the saddest stories from the NFT space… The project had so much potential to get into the hands of normies… it’s just sad."
Kraken and Nike: Scaling Back Digital Assets
Similar closures, like Kraken's NFT marketplace, highlight a trend of scaling back digital ventures amid cooling NFT markets.
Experts fear continued devaluation of NFT assets, while legal disputes unfold, potentially influencing future corporate strategies in digital investments.
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