Post-Mortem Valuation Shifts in Metaverse Startups: Assessing RTFKT's Legacy and Investment Potential After Benoît Pagotto's Passing

The death of Benoît Pagotto, co-founder of Nike-acquired Web3 studio RTFKT, at age 41 in October 2025, has cast a long shadow over the metaverse startup's legacy and investment narrative. Pagotto, a visionary who fused luxury design, gaming, and blockchain, was instrumental in RTFKT's rise as a pioneer of digital fashion. His passing, however, coincided with the winding down of RTFKT's operations-a strategic retreat by Nike under CEO Elliott Hill to refocus on physical products, according to BeInCrypto. This confluence of events raises critical questions about the valuation dynamics of metaverse startups and the enduring value of their creative outputs.

RTFKT's Ascent and Decline: A Case Study in NFT Volatility

RTFKT's meteoric rise began in 2020, when Pagotto and co-founders Steven Vasilev and Chris Le launched the studio as a bridge between physical and digital fashion. The Clone X × Takashi Murakami NFT series, which generated nearly $120 million in lifetime sales, according to The Block, epitomized RTFKT's ability to merge art, technology, and brand equity. Nike's 2021 acquisition of RTFKT for $33 million, according to SneakerFreaker, signaled institutional validation of the NFT space's potential. Yet, by late 2024, Nike announced the shutdown of RTFKT, citing a "strategic shift back to core product fundamentals," according to Fast Company.

The collapse of RTFKT's NFT valuation mirrors broader market trends. Clone X avatars, which peaked at 15.5 ETH in 2022, plummeted to 0.3 ETH by late 2024, according to NFT News Today. This 98% devaluation reflects the NFT market's systemic fragility, where speculative demand often outpaces utility. As one analyst noted, "RTFKT's fate underscores the risks of conflating brand prestige with digital asset value," BeInCrypto observed.

Legal and Market Repercussions: A Perfect Storm

Pagotto's death occurred against a backdrop of legal and operational turbulence. In April 2025, a $5 million class-action lawsuit was filed against Nike, alleging that RTFKT's NFTs were unregistered securities, according to Coin360. Plaintiffs argued that Nike's brand influence artificially inflated NFT values, only to abandon the market, leaving investors with worthless assets, as SneakerFreaker explained. While Nike has yet to respond publicly, the lawsuit highlights regulatory gray areas in NFTs and could deter future metaverse investments.

Market sentiment further deteriorated after Nike's January 2025 shutdown announcement. The NFT market, already reeling from a 53.77% decline in the CryptoSlam 500 Index, according to Blockhead, saw 98% of collections stagnate or lose value, Fast Company reported. Investors who had pinned hopes on RTFKT's digital fashion ecosystem now face a paradox: Pagotto's creative legacy (e.g., Clone X) remains culturally significant, but its financial utility is eroded by Nike's disengagement.

Investment Implications: Lessons for Metaverse Startups

RTFKT's trajectory offers cautionary lessons for metaverse startups. First, valuation reliance on parent brands is perilous. Nike's pivot away from NFTs exposed RTFKT to sudden obsolescence, a risk inherent in corporate-backed Web3 projects. Second, speculative hype without tangible utility proved unsustainable. Projects like Clone X, once hailed as "digital fashion's future," now symbolize the sector's overreach.

However, Pagotto's death has also sparked renewed interest in his creative ethos. Tributes from the Web3 community emphasize his belief that "beauty could change the world," as DAO Times reported, a philosophy that could inspire niche collectors to preserve RTFKT's legacy. Yet, for mainstream investors, the lack of clarity around Clone X's future-Nike has not outlined plans for its digital assets-remains a barrier to re-entry, according to CryptoRank.

Conclusion: A Bittersweet Legacy

Benoît Pagotto's passing and RTFKT's collapse underscore the volatile interplay between innovation, market forces, and institutional strategy. While his creative vision left an indelible mark on digital fashion, the financial and legal challenges surrounding RTFKT caution against romanticizing metaverse startups as safe investments. For now, the NFT market remains in a trough, with RTFKT's story serving as both a eulogy and a blueprint for what not to repeat.

As one industry observer aptly put it, "Pagotto's death is a reminder that even the most visionary ideas are vulnerable to the whims of capital-and sometimes, tragedy," as Coinotag reported.