Nike sues after closing NFT unit – Complaints charges significant cryptocurrency losses
A large group of disgruntled NFT buyers filed a lawsuit against Nike after the company closed its digital collectible RTFKT.
The lawsuit was filed Friday in Brooklyn, New York, claiming the sudden closure of the sportswear giant eliminates the value of hundreds of thousands of dollars in digital assets.
Australian investors lead legal battle with sportswear giants
The plaintiff’s class, led by Australia-based chief plaintiff Jagdeep Cheema, demands at least $5 million in damages. Nike’s December 2024 RTFKT closure has allowed investors to create and sell worthless digital tokens on both the Nike and RTFKT brands, according to court documents.
The complaint states that Nike violated consumer defense laws in many states, including New York, California, Florida and Oregon. Nike, based in Beaverton, Oregon, has not responded to the claims yet.
The lawsuit raises key questions: Does NFTS Securities do?
The court applied to argue that Nike sold NFTs without having to register them correctly with the financial authorities. This raises the fundamental question of whether U.S. regulators and courts are still working to answer: Is NFTS securities subject to regulatory scrutiny?
The purchaser said the company did not provide any notice before canceling the program. Many NFTs stop displaying images correctly, which helps worry that the assets will no longer be supported or held onto their value.
The plaintiff said in the lawsuit that if they knew they were unregistered securities, they would not buy any NFTs. The organization also claimed that if they knew Nike could cancel the project soon after it was founded, they would not invest.
Technical issues after service closure plague digital assets
After the closure in December, many users complained about serious technical problems in their NFTs. Images of highly precious objects in the cloned X series are lost and replaced by Cloudflare’s “Hold Page” message, indicating that the content has been deleted.
This is guessing that Nike stops paying for servers that display NFT images. Although some digital works then resurfaced online, the incident raised reasonable questions about the ultimate value of centralized service attached digital art.
Nike’s NFT adventure has a brief but memorable presence
RTFKT (pronounced “Artifact”) was acquired by Nike in December 2021 on NFT popularity. The sports company will be a bold step in the future of clusters, fashion and gaming.
Plaintiff’s attorney, Phillip Kim, has not commented further on the case.
When digital collectibles become trendy, many companies jump in without fixed regulations or supervision mechanisms. The lawsuit identifies the dangers posed by large companies testing and then abandons the nascent digital asset field.
Featured Images Nike, TradingView Chart
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