Loot is an NFT project that is taking the cryptoverse by storm. Unlike other NFT collections, Loot is entirely decentralized, and fully relies on the community to give it value. Though it may one day be the biggest NFT project, it is currently overvalued, and more of a cool experiment than the next generation of NFTs.
Loot has been taking over the NFT space for the past couple of weeks. Since its surprise release on August 27, it has amassed over $256 million in trading volume, and each of the 8,000 NFTs are selling for upwards of $20,000. Let’s take a look at Loot, its future development plans, and why exactly it has caught everyone’s attention.
Loot was created by Dom Hoffman, who is well-known for his creation of the video-sharing platform Vine. Each Loot NFT is a text file-esque list of items commonly found in fantasy games, such as a “Wand of the Twins” or “Dragonskin Boots of Skill.” Unlike other NFT projects, the artwork is not the main appeal, and these NFTs are as boring as possible from an artwork perspective.
Hoffman intended the lack of artwork to be a feature, and has called for the community to create their own interpretations of what the text signifies. There is no company, entity, or any other organization officially working on their project, and it is now completely up to the community to create whatever they want using the NFTs. It acts as a type of fantasy or role-playing game, where imagination is the key driver behind what the project will become. This is in stark contrast to other NFT projects like Bored Ape Yacht Club, where a centralized company decides what functionality the NFTs serve.
Part of the main initial surge in popularity from this collection came from the fact that all of the NFTs were completely free to mint after they were released.
In only three weeks, the community behind Loot has created a vast array of different resources and expansion packs. Some of these include Adventure Gold, a token that governs the Loot project, Potion text files, Enemy NFTs, and much more. Designers have also begun creating images for some of the text items, which makes them more valuable by giving them some sort of digital representation.
The idea of having a completely decentralized and community-run project has many in the cryptocurrency space excited, including Vitalik Buterin, creator of Ethereum.
Though this project is incredibly interesting and fascinating as a case study, it is certainly extremely overvalued at its current prices, especially given the small amount of value that has been added by the community. While it is true that the community behind Loot has been monumental in giving it its current valuation, they have done nothing that would make owning a Loot NFT worthwhile or extremely tempting, but instead made minor improvements. Additionally, the idea of Loot giving users items for a fantasy game is intriguing, but also has yet to become reality, and likely will not for a long time.
One argument may be that Loot NFTs have already priced in the future updates and apps that could be built around the project. However, nobody knows what these updates could be, as there are no official developers, roadmap, or whitepaper.
Furthermore, with the future of Loot being entirely decided by the community, and there not being any paid developers, there is a severe lack of incentive for Loot to continue to be developed once the hype dies down. Even though it is one of the most discussed NFT projects today, it may not be in a month, and the hype dying down is a matter of when, not if.
It is true that in the future, given enough development around Loot, the NFTs could be given real value and get them to a point where they are truly worth $20,000 each, if not significantly more, and become the largest and most popular NFT project with limitless potential. However, at the moment it is merely an interesting case study on what would happen when a community is in total control of an asset, and a side effect of the NFT market bubble.
By Lincoln Murr