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First things first a little backstory on the two companies in question. Nike, as really everyone knows, produces not only clothing but shoes, and over the last few years, the secondary market for shoes has been a place that kids and young adults could make pretty good money in. I myself have bought several pairs of shoes without planning on ever wearing them rather I was wanting to flip them as fast as I could for a profit. For a while, a huge issue with this secondary market though was knowing if your shoes were real or a knockoff fake pair.
Enter StockX
StockX is a marketplace that links buyers and sellers for shoes, streetwear, watches, collectibles, and more. The most important thing that they do though is they authenticate the items sold on their platform. For instance, when I sell a pair of shoes I ship it to them they check them out making sure they are real and then they send them to the buyer. This makes sure that everyone is happy with the product as they only deal in unused or unworn items. Rumors have been swirling for a while now that major shoe companies that produce and sell these shoes were upset that they did not have access to this secondary market which has grown to be worth billions of dollars.
The "Issue"
StockX just recently had launched its version of NFTs that are a little different from how NFTs function at this point in time. The StockX Vault NFT are minted as ERC-1155 tokens and represent an actual pair of shoes. These NFTs are only available on the StockX platform however due to their centralized nature the backing of each NFT with its own physical pair of shoes does guarantee them to be backed. The NFT owner has the ability at any time to redeem their NFT for the physical pair of shoes even.
Nike has taken issue with this though and has accused StockX of selling unauthorized images of its products with the NFTs and claims that consumers are confused and unsure if it is in partnership with Nike or not. Nike also recently bought its own company that specializes in sneakers in the Metaverse and so they do not want anyone else touching this space and their swoosh. Current laws seem to leave this stuff up for debate on if you can do it or not. While I am for Nike protecting its brand an issue at the core is that they have been after the secondary market in any way they can. StockX is utilizing the NFT technology as a way for people to own a shoe but not have to have it in their possession. It is not like StockX is mass producing these rather they are issuing an NFT for a shoe they physically have. Since these sneakers also never leave the platform I do not see them as a threat to Nike since its not like an avatar would be able to wear them in the Metaverse.
What I am seeing from Nike appears to be the ability to stop or at least be able to be involved in the secondary market for shoes in the Metaverse. This isn't something that I think Nike should be able to get away with as once they sell their shoes that's the end of the line for them as they have transferred ownership to the buyer. Any transaction that takes place after this is not Nikes business as they already sold it. These NFTs are linked to physical shoes and so with Nike selling its shoes once sold they shouldn't have the power to take back what they did so they could possibly make more money.
Please know I am not a financial advisor I am just someone who picked up on a trend and wanted to express it! Makes sure you always do your own research and never invest money you cannot afford to lose! If you enjoyed this article and would like to further support me below are a couple of referral links that if you used when signing up I would appreciate it! Also, follow me on Twitter @Cje95_
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