NFT Traders are Dropping Millions on Text-Based LOOT Tokens

Pixelated jpegs going for millions of dollars were already blowing people’s minds. The latest NFT project goes one step further –– traders are dropping what for some is a year’s salary or a property down payment, in exchange for white text on a black background.

The project was launched with a tweet from Dom Hoffmann, the creator of Vine, who shared the contract to mint a Loot “bag” on Aug. 27. With no fees aside from gas to pay, fanatics minted the 8,000 bags within three hours.

Now Loot is the hottest project in the NFT space. It’s already at the fifth slot on OpenSea in terms of trading volume with over $100M in the past 24 hours. The floor price, meaning the lowest someone is willing to sell a Loot bag at for, is 12.2 ETH, worth over $45K as of mid-evening New York time.

And one LOOT bag sold for 250 ETH, almost $1M on Sept. 2.

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White Text on a Black Background

But what is Loot? It’s basically eight traits that make up a bag of adventure gear. The first is a weapon, the second body armor, and so on as you see in the image below.

There’s also an element of rarity based on the traits. Anish Agnihotri spun up a file which organized the Loot bags in order of rarity. Bag 3043, complete with Demonhide Boots of the Fox and Amulet of Titans is the rarest of them all according to Agnihotri’s json file.

Unlike NFTs which often just point to a URL displaying an image stored off the blockchain, smart contracts can actually read Loot data. Developers can use these attributes to build add-on products around these traits, something they can’t do with image-based NFTs as they don’t have much data a smart contract can actually “talk” to.

Products being built range from DAOs for holders of Loot bags with Crown traits, to a currency for holders of the NFT to vote on a character’s action in a fantasy story.

“When a group of people find things to be fascinating and they want to build something on top of it, other builders also get the FOMO on that,” Thanakron Tandavas, a Loot holder and partner at web development studio Famolus, told The Defiant. “So, people came up with a bunch of ideas that they can build on top of Loot.”

Sure enough, Hoffman said in his launch tweet that he didn’t include images or statistics as part of Loot intentionally. The minimalism plus the smart contract readability of the traits are the big reasons why the project has generated so much buzz, and more importantly, so much building.

Built On Top

In what was perhaps the most obvious derivative of the project for the NFT community, people have already started making generative art based on the traits.

Some of the derivatives create tribes of LOOT holders. For instance, there’s a website which only admits people who hold Loot with the body armor characteristic of Divine Robe, a trait which under 5% of the NFTs have. The cheapest bag with such a robe costs 51 ETH, over $200K, at the time of writing.

“People started to group up into an exclusive community based on what items they got in their loot bag,” Tandavas said.

There are just over 2,300 Loot holders, with one address holding 307 of the NFTs, worth well over $10M according to a Dune Analytics dashboard.

Hofmann addressed LOOT token concentration by creating Synthetic Loot which every Ethereum address can mint. “Creators building on top of Loot can choose to recognize Synthetic Loot as a way to allow a wider range of adventurers to participate in the ecosystem,” the Vine founder tweeted.

Adventure Gold

Another item that’s been built on top of the project is a currency called Adventure Gold, or AGLD. Ten thousand tokens are available only to wallets which hold a Loot NFT. AGLD was trading at $2.77, with a $181M market cap in late evening Thursday, New York time.

Some Loot holders are already selling their currency — what has amounted to a free $20K airdrop. Aave’s founder and CEO Stani Kulechov is even tweeting about listing ALGD on the lending platform.

“What can I use $AGLD for? Anything the community decides! Right now people are using it to vote on storylines and other governance features,” tweeted Will Papper, the creator of Adventure Gold and a co-founder of Syndicate DAO, an organization which aims to change how venture capital is deployed.

Indeed, AGLD holders are already voting on Snapshot whether a fantasy story’s character should put on a crown or destroy it.

Copycats

Plus, another obvious crypto move was the creation of copycat projects. Colin Platt, the CEO of NFT infrastructure provider Unifty, launched one on Aug. 2 calling it “Loot for people that missed Loot.” The project uses black text on a white background and already its floor price is 0.4 ETH, over $1,000.

This is all part of what Tandavas is calling Loot’s bottom-up approach. This means that instead of someone producing an NFT and then fashioning add-ons themselves, Hoffman created a bare bones project for the Web 3 community to build. Tandavas likened most NFTs as akin to a prefab house, there’s little choice in how it looks. With Loot, users have the bricks and the wood needed to make whatever kind of house they want.