Nike is facing a class-action lawsuit accusing the company of pulling a "rug pull" after abruptly shutting down its NFT platform, RTFKT, earlier this year. A group of RTFKT users, led by Jagdeep Cheema, filed the lawsuit in Brooklyn federal court on April 25, claiming they suffered "significant damages" after investing in Nike’s sneaker-themed NFTs—only to see the platform shut down.

The lawsuit alleges that Nike sold these NFTs as unregistered securities, sidestepping the necessary registration process with the Securities and Exchange Commission (SEC). It also accuses the brand of using its global reputation and marketing clout to promote and sell these digital assets without proper oversight.

According to the plaintiffs, the value of Nike’s NFTs was heavily tied to the brand’s success and marketing efforts. Buyers were led to believe their investments would grow over time as Nike expanded its presence in the digital space.

Source: CourtListener

But for many, the loss goes beyond just money—it’s about broken trust. Nike, a brand long associated with loyalty and innovation, now faces accusations of betraying its community. So far, the company hasn’t issued a detailed public response, but legal experts suggest the case could have major implications for accountability in the fast-moving world of NFTs and Web3.

As the case unfolds, it highlights just how delicate trust remains in the digital asset space, where big promises often outpace regulation and consumer protection. The coming months will show not just how Nike responds but also how brands will be held accountable when stepping into decentralized markets.