Remember NFTs? Back in 2021 they were the talk of the art world, and big brands wanted in (see our piece on what are NFTs? if you blinked and missed it all). Nike entered the fray when it bought the 'digital shoe company' RTFKT.
But like many gambles during the NFT boom, things didn't work out. Nike's closed the company, and now it's been sued.
RTFKT made virtual sneakers and other items that could be used in metaverse applications. It also worked on physical shoe collections, some linked to NFTs. But Nike announced on the RTFKT X account back in December that it would “wind down RTFKT operations” by the end of January.
In a class action lawsuit lodged in New York’s Eastern District this week, customers claim they wouldn't have bought Nike NFTs if they knew they were “unregistered securities". According to Reuters, they're demanding unspecified damages of over $5 million for alleged violations of New York, California, Florida and Oregon consumer protection laws.
It appears that since the closure, RTFKT artwork was being maintained by one person, Samuel Cardillo, and that around 30,000 NFTs were wiped due to a service error. A company called Ar.io is now working with the RTFKT team to migrate these NFTs to its Arweave-based ArDrive permanent cloud to make them available for posterity.
Ar.io CEO Phil Mataras says the incident shows the risk of storing things on centralised networks. "Nobody likes to see their content lost - especially due to a mistake made by a cloud provider, and especially when it's 30,000+ NFT images," he said. "Our team is working closely with the RTFKT team to support the migration of the collection through our storage app, ArDrive."
He added: "Once uploaded, these images will stay put, forever."
NFTs felt like risky territory for a brand like Nike to get involved in. That's not to say the tech doesn't have useful and valuable applications, but there have been so many murky crypto scams, and mass market gimmicks like virtual trainers always seemed like a passing fad.
