Andrew Gould rises most days at 5am to get to his job shifting concrete for eight hours in 90 degree heat. But he spent one morning on Zoom telling me about the community he’s building around Loot, possibly the hottest NFT project in cryptoland.
Gould is the publisher of The Herald, a Substack that covers Loot. He has 1,000 subscribers, including the founder of Figma. He’s only published one issue so far, and it’s mostly a collection of tweets by notable people (Chris Dixon! Stani Kulechov!). But to be fair to Gould, Loot itself is only about two weeks old.
Like many phenomena that gain widespread attention in the crypto world, the price of Loot has skyrocketed from zero—they were given away free—to about $80,000 apiece at their peak on Sept 3. They’re now changing hands for as much as $40,000 apiece. Gould has one Loot “bag”, as the parlance goes.
Holding an asset worth tens of thousands of dollars is a new feeling for Gould, who tells me he had $2,000 in his bank account last week. He’s telling me this through tears as I ask him about what he’s going to do with his newfound wealth. He has been working as a manual laborer by day and a screenwriter by night since he was finishing college—about a decade. Life has been a struggle, but the Loot project has changed things.
“It’s been pretty amazing,” Gould says. “To see how quickly this value was created and how I was able to contribute to that value. It feels like I’ve been struggling to find, work-wise in my life, something that gathers all my interests and sets me on fire. And this did that.”
What is Loot
Which brings us to the question of what Loot is, exactly. It was created by Dom Hofmann, a co-founder of the video app Vine, and launched by tweet. According to the official website, they are a collection of 8,000 bags of adventure gear. Each bag contains eight items, with names like “Short Sword of Skill” or “Tome of Anger”. Oh, and the bags are NFTs with an image of white text on a black background. That’s it. Seriously.
Loot was released with no apparent purpose. All 8,000 bags could be claimed by anyone on the internet at no charge. They only had to pay the gas fees on Ethereum for minting the tokens into existence.
The main idea behind Loot is a little like Bitcoin: Drop a thing on the internet that’s controlled by no one and can be owned by anyone. Here’s what the Loot website says:
“Loot is the unfiltered, uncensorable building block for stories, experiences, games, and more, in the hands of the community, at no cost. Loot pursues complete decentralization from day one.”
So why is Loot interesting? It’s because of a feature of Ethereum tokens called composability. This means that one thing built on Ethereum can interact with another pretty easily. So creating a thing on Ethereum is akin to making a building block that can be used in conjunction with other building blocks.
People in Ethereum used to call these building blocks “money Legos.” This was mainly because the applications people were making on Ethereum revolved around finance and moving money around. The explosion of money Legos led to the movement we know as DeFi today.
In the DeFi world, you can deposit some tokens into a lending platform like Aave or Compound, lend against your collateral, take those tokens and swap them on a decentralized exchange like Uniswap, and do ever more intricate things with them across the entire Ethereum blockchain. Increasingly, you can do things on other blockchains as well, crossing your tokens over with bridges.
The cool part is you can do all those things without the developers of Aave or Compound needing to create a partnership with the creator of Uniswap. It’s all inter-operable, and it all works without anyone having to seek permission or sign a deal with anyone else. That’s composability on a blockchain.
Why is it interesting
Loot isn’t the first attempt to do something non-financial with composability. People tried it with the OG NFT project CryptoKitties back in 2017.
You see, CryptoKitties was launched by a company, Dapper Labs. The company drew all the art for the project, and then made it available for use under a pretty relaxed license. It also open sourced the smart contract programming behind it. That meant independent developers could build applications around the Kitties.
This effort came to be known as building “the Kittyverse.” Independent developers created new ways to use your CryptoKitties besides the breeding and collecting Dapper Labs came up with. There was KittyRace (which I wrote about in 2018) where you could enter your cat into random races with other cat owners. The winner took a prize pot of Ether home. Other applications let you dress up your cat with a collection of cool hats, and so on.
But the Kittyverse lost momentum as crypto entered a multi-year bear market. Smart observers of the NFT space also point to fundamental difficulties: it’s more profitable to launch your own NFT project than to build on an existing one.
So, what makes Loot different? For starters instead of a crypto winter, Loot is being launched in a booming crypto market that seems to hit new highs every few weeks. The NFT ecosystem today is a far cry from the days of CryptoKitties. Multiple marketplaces see hundreds of millions in transactions daily, and the world’s most storied auction houses now regularly have NFTs on their books.
The Loot ecosystem itself also seems to be proliferating at an astonishingly rapid pace, even by crypto standards. In the 10 days since the original 8,000 bags were minted, there are now dozens of projects built around them. These range from developer tools to price-tracking sites and brand-new applications.
People are even creating in-game currencies for Loot: something called Adventure Gold was created and made available to any Loot bagholder: to the tune of over $50,000 per bag. (Adventure Gold itself has been forked, and there are now competing versions of it, which is a whole other story).
All of this is leading to a movement to create a Loot “metaverse.” One of the ways to populate the metaverse is with derivatives: generating new NFTs that are based on the original loot bags. Lili Feyerabend is a designer and a co-founder of Loot Metaverse. She’s also re-writing another NFT project called CryptoManga to make it work with Loot items.
“The trading volume on each of the derivatives, it’s insane,” she says, pointing to trading volumes of over 200 ETH on one project (that was worth about $800,000). “And this is each of them, it’s insane.”
Diversity and creativity
But Andrew Gould, of The Herald newsletter, might hold a clue to what makes Loot so interesting—and, potentially, a really big deal of a crypto project. Just as Gould is an atypical crypto participant and unlikely NFT holder, so others like him are being drawn to the open, oddball, and ultimately creative, dynamics that Loot evokes.
Feyerabrand points to the fact that the Loot Discord servers are populated by not just coders but also writers, designers and artists. “This could only happen now because people were totally ready for something new,” she says. “It’s happening now when there are many more developers, designers and artists in the space.”
It’s the diversity of crypto culture today that’s enabling projects like Loot to launch and attract dozens of independent projects around it in days. That’s what’s bringing designers like Feyerabend and screenwriters like Gould to the table. Gould sums it up:
“Loot is about creating the IP and then giving it away and letting creative people create,” he says. “I'm still trying to wrap my head around what that means.”