Nike has announced it is shutting down RTFKT, its digital sneaker company. The move comes after a few years of hype and then a sudden decline in the market for NFTs. Nike bought RTFKT in 2021 during the crypto boom. The company was valued at $33 million before the purchase. RTFKT was seen as Nike’s way into the metaverse, with plans to create virtual sneakers and digital fashion. The founders, Benoit Pagotto, Chris Le, and Steven Vasilev, started RTFKT in 2020. They quickly gained fame for making viral digital sneakers that became popular in the virtual world.
During the pandemic, RTFKT focused on NFTs and virtual fashion, riding the wave of the digital trend. Their sneakers became known as the “Supreme of the metaverse,” because of their popularity and hype. However, by late 2024, Nike announced that RTFKT would shut down. They posted the news on X/Twitter on December 2. The company plans to fully close by late January 2025. After closing, the digital assets like Murakami NFTs and virtual Dunks will be stored on a special website. The shutdown also means online quests and community activities are ending. The CEO, Elliot Hill, took over in October 2024, and he shifted Nike’s focus from NFTs to traditional sports and athletes. This strategic shift indicates a move away from digital assets toward core business areas. This decision reflects a broader trend where companies are reassessing their investments in digital assets and prioritizing more stable ventures.
The market for NFTs has fallen sharply since the crypto market cooled. Many people who bought RTFKT NFTs lost their investments as digital assets lost value. Nike’s move away from NFTs included a decision to focus more on video game partnerships and physical products. Before the shutdown, Nike showed off hybrid sneakers at a Portland exhibit, blending physical and digital designs. In September 2024, Nike paused all NFT production, signaling trouble ahead. This decline in digital assets has been accelerated by broader economic factors, including increased regulation and market saturation. A lawsuit was filed in April 2025 by an Australian man, Jagdeep Cheema. He claims Nike violated consumer laws and says NFTs should have been registered as securities. The lawsuit also accuses Nike of intentionally devaluing digital assets, calling it a “rug pull.” This legal case highlights the unclear rules around NFTs and securities. Investors, who once saw NFTs as valuable, are now upset. Many can’t trade their digital assets anymore, and some criticize Nike for not being transparent about the shutdown. The case could set a precedent for future NFT laws and regulations. Overall, the fall of RTFKT shows how risky digital assets can be when market trends change fast.
