The market for collectible sneakers has skyrocketed in recent years. And until recently, so had the market for NFTs, or non-fungible tokens, which function as digital certificates of ownership for works of art as well as tattoo designs and virtual real estate.
It was only a matter of time before the two hypebeast markets collided.
In April, Nike released its first collection of virtual sneakers, called Cryptokicks, which comprised 20,000 NFTs, including one designed by artist Takashi Murakami that was bought by someone named AliSajwani for $134,000.
“The mechanics around NFTs and sneakers are pretty similar” said Jurgen Alker, who runs the NFT studio for Highsnobiety, the lifestyle site that covers streetwear and sneakers. “Both are created around scarcity and drops. It is about community, status and belonging to something.”
This is Nike’s first entry into the market and its first release with RTFKT (pronounced “artifact”), a company it bought last December that had stoked a market for virtual sneakers.
Asics, the Japanese athletic brand, recently created 1,000 NFT sneakers in collaboration with STEPN, a fitness app that rewards runners with cryptocurrency for each step they take (think of it as a combination of Pokemon GO and Strava). The virtual sneaker can be worn in the app, and features “gamification” features including sneaker leveling, shoe-minting and NFT customization, said Yawn Rong, one of the founders of STEPN.
Other sneaker giants also have gotten involved. Last December, Adidas released an NFT collection called into the Metaverse that gave buyers access to limited-edition streetwear including hoodies and tracksuits (but no sneakers). Made in partnership with the Bored Ape Yacht Club, Punks Comic and crypto evangelist GMoney, it was essentially a digital drop for NFT-savvy Adidas collectors and netted more than $22 million in the first afternoon, according to The Verge.
In one sense, virtual sneakers offer the same bragging rights as the real thing. Collectors can show them off on social media or in NFT exchanges like OpenSea.
So what do the buyers of the Nike Cryptokicks actually own? It’s not entirely clear.
The rollout was shrouded in mystery. In February, RTFKT released 20,000 NFTs of a mysterious box called MNLTH, pronounced “monolith” (vowels, apparently, are for noobs in the NFT world). The only clue about what was inside was the Nike Swoosh and RTFKT’s lightning bolt logo.
On April 22, after months of speculation, Nike announced on Twitter, Discord and other social media platforms that owners could connect their crypto wallets, where they stored the NFTs, to the RTFKT site to “open” their boxes, Chui said.
Inside, owners found a digital image of a generic basketball shoe called a Nike Dunk Genesis Cryptokick, along with a virtual “skin vial”— a glowing canister that, once inserted into a port on the virtual sneaker’s tongue, gives the sneaker its final look.
The skins also determine the sneaker’s worth. Owners were randomly assigned one of eight skins, ranging from the most common, “Human,” with its fuchsia and black colorway, to the rarest, “Alien,” in purple and green.
Their value on the secondary market varies widely, according to scarcity. As of this writing, there are 5,661 Human vials available on OpenSea, with a floor price of 0.59 Ether (about $1,154, although crypto prices have been fluctuating wildly). There are only 18 Alien vials on the market, with a floor price of 90 Ether (about $176,000).
For now, the Cryptokicks only exist in digital form, viewable on OpenSea or the RTFKT site. But owners are hoping they eventually will be able to modify them as new skins are released, and also wear them in online games and in the metaverse.
This article originally appeared in The New York Times.
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