Nike, Starbucks And Co Exit NFTs But Crypto-Natives Remain Put
Nike is facing a $5 million lawsuit from a group of people who bought its Nike-themed non-fungible tokens. The report follows the global footwear and apparel giant's closure of its RTFKT (pronounced artifact) unit in December 2024. It comes at a time when NFT transaction volumes have fallen to record lows despite the recent resurgence in the crypto market.
A handful of other mainstream brands and crypto companies have also closed their NFT projects including Starbucks and DraftKings, while X2Y2, at some point was one of the biggest NFT marketplaces said it is pivoting to crypto AI.
However, not all believe that the current state of the NFT market spells curtains for the industry, with Solana-based decentralized exchange platform Jupiter consolidating its strategy for the crypto industry with the acquisition of digital collectibles platform DRiP Haus.
The NFT market fell 24% in the first quarter of 2025 to $1.5 billion compared to the preceding quarter, according to a DappRadar report. However, the number of sales was down 10%, implying a substantial decline in the average price for NFTs sold versus the quantity.
The $1.5 billion trading volume recorded between January and March 2025 is just a fraction of the $5.7 billion recorded for the final week of January 2022, when the industry was at its peak, as per Token Terminal data.
The Token Terminal also shows that whilst NFT trading volume fell by 24% in the most recent quarter compared to Q4 2024, there was a significant improvement over the past two quarters when compared to the preceding two.
That surge was linked to the general positivity surrounding the crypto market in the wake of President Trump's election. But even such optimism could not prevent Nike from implementing its previously rumored course of action of shutting down RTFKT.
In December, RTFKT announced via Musk's X platform that it was winding down its NFT business. In January, the company concluded its creative journey with the launch of the MNLTH X Blade Drop, released in collaboration with the 3D-printing footwear manufacturer Zellerfeld.
Last week, images of CloneX NFTs on the NFT marketplace OpenSea temporarily disappeared after Cloudflare downgraded the account responsible for serving the files. The CloneX NFT collection is one of the biggest by sales volume on RTFKT's portfolio with 470,434.88 ETH, according to CoinMarketCap data.
At the peak of the NFT boom, Nike was reported to be the best-performing mainstream brand in the industry, generating $185 million from NFT sales as of June 2022.
Just over two and a half years down the line, and nearly four months after news that RTFKT was shutting down, the company is now facing a $5 million lawsuit from a group of people who purchased its NFTs.
In the class action filed in Brooklyn, New York federal court on Friday, the purchasers claim the closure of Nike's RTFKT platform caused the demand for their NFTs to dry up, Reuters reported.
Nike is not the only mainstream brand that is moving away from NFTs. In March 2024, Starbucks officially closed its NFT royalty program. In the preceding month, Gamestop also closed its NFT marketplace, just months after removing support for its NFT wallet. In both cases, Gamestop pointed to continuing regulatory uncertainty in the crypto industry.
Last month, NFT marketplace X2Y2, which once was among the biggest platforms by transaction volume also said it is closing its NFT business to focus on decentralized artificial intelligence. The company pointed to the declining NFT transaction activity as the main reason for its decision. The company said NFT trading volume had fallen 90% from its all-time highs.
While some of the biggest brands seem to be retreating from NFTs, some crypto-native companies have chosen to stay, and are now, consolidating their positions in the space.
Earlier this month, Solana DEX platform Jupiter said it is acquiring digital collectibles platform DRiP Haus, as part of a broader strategy of upgrading the platform into a 'super app'.
Web3 super apps are decentralized applications that offer different services within a single platform, including token trading, NFTs, payments and cryptocurrency swaps.
'We don't believe it,' Jupiter's Kash Dhanda told CoinDesk about claims that NFTs are dead. 'We think NFTs are here for the long term.'
Other NFT projects like Pudgy Penguins and Doodles have shown what could be the next evolution of NFTs, by expanding their their strategy into gaming and launching tokens. While PFP NFTs still dominate sales with about 56% of volume, as per DappRadar, sales have been falling more drastically compared to gaming NFTs, which are second in transaction activity.
Last October, Pudgy Penguins announced it is developing a AAA blockchain game 'Pudgy Party' set to debut on iOS and Android in 2025.
The company also launched the PENGU token, with 25.9% distributed to the Pudgy community, which includes Pudgy Penguins, Lil Pudgys, and Pudgy Rods NFT holders.
In February this year, Doodles also announced it is launching a Solana-based token, DOOD, as part of an expanded NFT strategy that positions the brand as an entertainment company focused on immersive storytelling. The token will later launch on Coinbase's Ethereum layer-2 blockchain Base.
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