Nike buys out Sneaker and Fashion NFT Creator

Whether you love NFTs (non-fungible tokens) or love to hate them, they’re exploding in popularity, and this latest acquisition vouches for their mainstream street cred – Nike just purchased NFT studio RTFKT (pronounced “artifact”), which is helming a much-touted avatar partnership called CloneX.

If you’re scratching your head, you’re not alone. Until I began investigating these unique pieces of digital art, I didn’t know what the acronym meant, let alone their significance.

Non-fungible tokens are both a godsend for digital artists and quite possibly the biggest speculative bubble in human history.

NFTs allow the holder of said item to verify ownership, authenticity, and uniqueness through the blockchain – in a literal sense, no two NFTs are alike. They ensure digital artists receive proper credit for their work, and while a JPG of the NFT might look similar, there’s only one verifiable, original file.

I’ve worked with a bunch of talented artists throughout my time in publishing, and I can assure you their digital creations take just as much skill as the physical sort. If the notion of NFTs allow digital artists to receive proper credit (and compensation) for their work, I’m their biggest cheerleader.

On the other hand, the value of NFTs sits on a very shaky premise – that enough people care about them to maintain their value. Without that, they’re not even worth the paper they’re not painted on.

An NFT, Everydays: the First 5000 Days, by artist Mike Winkelmann, sold for $69.3 million in 2021, and if enough people decide tomorrow that it’s not worth anything, it’ll have zero tangible value. Granted, pieces of physical art hold little worth based purely on the ink and canvass, and the true value is in its intangible qualities, but people instinctually prize items they can hold in their hands more than a digital file – it’s why digital trading cards sell for a tiny fraction of physical ones, even if the physical ones cost a negligible amount to print per card.

While terms of the Nike deal weren’t disclosed, crypto tracker CryptoSlam notes that the CloneX project has already seen $65 million in transaction volume, and wild speculation like that on a new art form/technology reminds me of the dot.com bubble of the late ‘90s, where investors were just throwing money at anything with the slightest whiff of the world wide web.

And, well, we all know what happened next.

Nike clearly has more than enough cash to bet on risky propositions like NFTs, but I wonder if everyone spending thousands (or millions) on these digital pieces of art can afford a total loss.

Either way, NFTs are getting a lot more mainstream, and get ready for blockchain-enabled digital art from the swoosh.