On Oct. 4, a Chinese trader noticed a sharp drop in the price of crypto tokens backed by Nike’s Air Jordan sneakers on a U.S.-based exchange after the general manager of the NBA’s Houston Rockets tweeted support for the protests in Hong Kong.

The trader posted about the fall - which he told Reuters was more than 10% at the time - on Weibo, China’s equivalent of Twitter. His post went viral, attracting thousands of comments and becoming one of the most searched items on Weibo last week.

The trader, who declined to give his name, said such price swings were not unusual in the speculative world of cryptocurrencies and asset-backed tokens.

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“But it’s clear sneaker speculators were pulling money out of the market” after the Chinese government and netizens responded angrily to the comment by Houston Rockets general manager Daryl Morey, he said.

Morey quickly deleted his tweet, but the damage was done.

Chinese state media started to attack him, the Houston Rockets and the National Basketball Association (NBA), accusing them of endorsing violence and peddling a “secessionist pipe dream.”

Since the incident, quotes for tokens backed by the Air Jordan 1 Retro High Satin Black Toe shoes - the latest variant of the iconic 1980s model - have fallen 34%, according to Reuters calculations based on data from 55.com, a major global exchange for asset-backed tokens.

In China, the trading of tokens and cryptocurrencies such as Bitcoin is banned, but Chinese investors are active on overseas exchanges. On 55.com, traders can exchange yuan for cryptocurrencies such as Tether via Alipay or WeChat to acquire tokens.

It is also possible on 55.com to trade tokens backed by other designer merchandise such as hoodies by Supreme, a U.S. clothing brand under the Carlyle Group.

Hong Kong-based George Gao, a sneaker brand influencer in China with more than 38,000 followers on his YouTube channel, said the NBA backlash among mainland basketball fans was “unprecedented.”

Global brands can suffer when they offend their client base in China, where millions of online citizens rapidly respond to perceived cultural slights or insults to the country. For NBA, the China market is estimated to be worth more than $4 billion.

Last week, Houston Rockets sneakers and other merchandise were pulled from several Nike stores in major Chinese cities.

Poizon and DoNew, two Chinese mobile shopping apps popular among fans of designer sneakers, also took NBA-logo shoes off their platforms, traders said.

Xu Xiaotian, an avid sneaker collector in the southern city of Guangzhou, said he would boycott “anti-China” brands and take political concerns into consideration during his next purchase.

But he also said individual NBA players were not directly involved in the controversy.

In June, Xu bought online a pair of Nike Air Jordan 1 Retro High “Pass The Torch” sneakers inspired by the Los Angeles Clippers’ Kawhi Leonard. Xu paid 13,000 yuan ($1,837.85) and sold them for 33,000 yuan that month.

Xu said he would invest in NBA shoes again despite his feelings about the NBA.

LeBron James - a star player for the Los Angeles Lakers and widely considered to be the face of the NBA - weighed in on the controversy on Monday, saying Morey “wasn’t educated” when he sent a tweet in support of protesters in Hong Kong.

On mobile app Sneaker Sale Calendar, a popular tool for sneaker price comparison among Chinese collectors, the price of Nike’s LeBron 16 “MPLS” shoes rose 142% to 1,944 yuan on Wednesday from a day earlier.

Other brands associated with the NBA, such as Nike and Adidas, have been largely unscathed.
Gao said the price of a new pair of limited-edition Nike shoes in collaboration with U.S. rapper Travis Scott, which made their debut in China on Friday, surged more than fivefold to almost 8,000 yuan from 1,399 yuan in online resale markets.

“Political factors do affect my choice,” said Chen Luwei, a Chinese sneaker fan studying in Australia.
“If there is any insulting speech by Nike or Adidas, it may affect my decision to buy their shoes,” Chen said. “But I can’t just throw away my previous ones, right?”