Understanding Loot, the paradigm shift of NFTs in progress

Author: Xiao Ming on the Construction Site

Source: Shenchao TechFlow

Loot has become so popular that I finally understand that the Chinese meaning of Loot is "robbery," and it can also be used as a noun meaning "spoils."

Today, Loot is a black-background white "JPG" (in NFT form), with a floor price of 8 ETH on the NFT trading platform Opensea, equivalent to $30,000.

On September 2, Feng Bo, founding partner of Ceyuan Venture Capital, bid 35 ETH to acquire Loot #1288 on the Element platform, equivalent to $130,000 or 840,000 RMB.

Another "bubble" that is hard to understand has emerged. Although I am currently on a construction site, I still attempt to briefly explain Loot and why I believe this represents a paradigm revolution in NFTs.

Conflict of Interest: The author holds partial ownership of Loot.

What is LOOT?

On the official website, it is introduced in just two short lines of English:

Loot is randomized adventurer gear generated and stored on chain. Stats, images, and other functionality are intentionally omitted for others to interpret.

Loot is randomized adventurer gear stored on the blockchain. Stats, images, and other functionalities are intentionally omitted for others to interpret.

Feel free to use Loot in any way you want.

In simpler terms, Loot is an on-chain NFT with a black background that contains only text. Anyone can participate in minting and will randomly receive a set of fantasy adventurer gear, of course in text form, with randomly distributed scarcity characteristics.

Each Loot contains 8 types of gear, hence there are 8 lines of text, each representing a type of gear.

Weapons

Chest Armor

Head Armor

Waist Armor

Foot Armor

Hand Armor

Necklaces

Rings

To generate random scarcity, the contract assigns a token ID to the owner, and each Loot can have prefix or suffix content added based on the hash of your "token" ID, with a 42% chance of a suffix appearing and an 8.7% chance of a prefix.

A prefix might be "Spirit Song," and a suffix might be "of Protection," with prefixes being more scarce.

The final presentation looks like this:

On tool websites, you can input the Loot ID to check the quality geometry of that NFT, which is certainly familiar to players of games like WOW.

The total amount of Loot is 8,000, with the creator reserving 222 as rewards (these tokens have the same scarcity distribution as others). Currently, all NFT tokens have been minted and claimed.

From on-chain data, Loot NFTs still show a trend of large holders monopolizing.

Why is Loot so popular?

Similar to the popularity of YFI during DeFi Summer, Loot has introduced Fair Launch and composability into the NFT system to some extent.

Unlike the top-down ICO logic of "issued by creators, purchased by users" seen in most NFTs, Loot has created a more decentralized way of minting NFTs, allowing anyone the opportunity to participate in the minting process.

As a result, the value of NFTs is no longer tied to a single organization or individual, but relies on the power and consensus of the community, which in the long run depends on the "level of construction" of Loot in the future.

Bottom-up

Community-driven

Novel concept

Absurd

Simple

All these attributes make Loot more cryptonative, and this is just the beginning.

Currently, the high price of Loot comes more from novelty and speculation, but the emergence of Loot also provides new choices and possibilities for the future development of the entire NFT space, granting greater imaginative potential.

Current Loot can be considered a minimal viable product (MVP), and anyone can use Loot to connect and expand with other protocols, similar to building blocks in DeFi, continuously creating and constructing on the foundation of Loot.

On the fifth day of its inception, many ecological applications have already been built around Loot, although they are still in their infancy.

Joel John, a leader at LedgerPrime, believes that any blockchain game can incorporate items or characters from Loot and quickly capture a large user base.

Traditional game developers spend a lot of money on promotion and cold starts, but the introduction of NFTs can quickly attract a group of high-net-worth users to participate. For example, Loot holders may obtain equipment or characters in the game that can be rented or sold, generating cash flow and turning them into income-generating assets.

Currently, there have been relevant attempts and ideas.

Matt Huang, founding partner of Paradigm, asked a question on Twitter: Is LOOT the seed of a game (or a collection of games)? Or is the process built around LOOT the real game?

I think both are true.

The Future of Loot

The initiator, Dom, has envisioned what might happen next in Discord:

Commissioning artists

Automating Loot

Explaining how certain weapons/armor levels and enchantments match with stats

Smart contracts that split Loot into individual items.

Forks, including new or differently themed loot

Games

But remember, Loot is an experiment.

The future of this experiment depends on everyone in the community, even everyone interested in it and willing to participate in its construction.

It is both a paradigm shift in NFTs and a MEME.

Everyone can recreate around simple text.

Some have created related music.

Some have designed related merchandise.

After the initial novelty, for Loot to maintain long-term vitality, it must either become a cultural MEME, akin to CryptoPunks (a high-value NFT), or the ecosystem built around it must thrive, becoming an infrastructure layer in the NFT world, constructing a Loot universe from blocks of Loot.

I tend to favor the latter.

Additionally, it is foreseeable that since Loot's inception, there will be more "imitators" emerging, potentially evolving into a new trend.

The Initiator and His Voice

The creator of Loot, known on Twitter as dom, is named Dominik Hofmann, an American programmer and entrepreneur born in 1986.

He came into the public eye in 2012 when he co-founded the 6-second video app Vine with two friends, which was acquired by Twitter for $30 million the same year. However, the app was shut down by Twitter in 2016, and Dom publicly expressed his disagreement with how Vine was handled.

Later, Dom continued to pursue entrepreneurship and launched a 16-second short video app called Byte in 2020, attempting to challenge TikTok.

Fate is indeed magical; today, a casual act of his has changed an industry and perhaps altered his future.

Dom admitted that the past few days have been like a whirlwind. What was originally intended as an experiment in community ownership and composability has now exceeded all expectations. He stated that he is currently mainly thinking about the following matters:

1. We need to be particularly cautious about scams. The nature of this project makes it easier for bad actors to exploit the goodwill of the community. When a link comes in, take some time to feel whether it is legitimate. Let the community detectives investigate it. Communicate and look out for each other, and be cautious out there.

2. We are community-driven. This project is important to me, and I look forward to contributing significantly to it. At the same time, the focus is on us building it together; it is decentralized. I will provide guidance in meaningful ways (only when needed), but it is important for others to step up to lead, which is already happening, but I just want to ensure I share my perspective on it.

3. We need to consider when to use and not use NFTs. This is mainly directed at developers and creators in the community. Remember, there are many ways to build and expand the ecosystem. There is a good reason to tokenize many things (especially at this stage), but over time, we will need to think more about what we really want to achieve.

We need to consider public utility contracts or simple applications, if they are meaningful, and seek community demand for tokenization before participating. And when tokenizing, we need to consider collaborative efforts and propose standard composability methods to assist the development of the next project. That’s all for now.

Remember, the spirit of the project is to work together and help each other. I think we have done well in this regard so far, and the whole world is watching, so let’s keep it up.

Good luck to Loot!