Your crypto feed has probably been inundated by NFT news recently. Not only have NFTs made a comeback from their Q1 breakout, they’re now scaling new heights to the tune of over $2 billion in monthly trading volume on OpenSea.
By now even your grandmother might have heard of a “Cryptopunk.” There’s certainly no shortage of salient projects — from punks to apes to penguins and back to 3D punks or mutant apes…the fads in this space seem to change faster than a newborn’s diaper. As a respected crypto exchange, Phemex always keeps its ear to the ground on interesting NFT trends.
Enter Loot
One of the hottest NFTs in September so far is Loot Project. Consisting of 8,000 “bags of loot,” which are essentially just a list of words, this project is as ambitious as it is simple. At first glance, it seems insane that 250 ETH (~$880,000) was ever paid for one text list of 8 random, made-up items on a black background.
But after peeling back the layers, Loot might just be one of the most innovative NFT projects ever released, and one that holds disruptive implications not just for NFTs but for the concept of decentralization.
The project was created by Dom Hofmann, best known for being the founder of Vine app. All 8,000 loot bags were released for free on August 27th, with interested parties only having to pay the gas fee to mint one. Today there are over 2,300 loot NFT holders and one address holds 307 loot bags, which is worth over $10 million at current valuation.
Unlike most other popular NFT projects, loot bags have no artwork or interactive elements attached to them. Conventional NFT wisdom (if such a thing exists) would consider this asinine, because nearly all successful NFT projects have relied on a visual component to drive demand. After all, how else are buyers supposed to show off their expensive Meebit other than using it as a profile picture? However, it’s precisely the lack of any audiovisual elements that grant Loot Project an extra degree of decentralization. Its philosophy is to have its community create the visuals, the story, the infrastructure, and eventually the game or even industry.
After releasing 8,000 loot bags, project creators have offered no guidelines on how to interpret any of the content. Instead, a community has rapidly formed to take the reins.
Within days of the launch, users across the web have already built out rarity charts, stat attributes, art-styles and lore centered around the project. Separate guilds have also sprang up that accept members based on items found in their loot bags, the most exclusive of which is for owners of “Divine Robes,” which are contained in less than 5% of all bags . The loot community is still in its infancy with major plans in the works, but its blistering growth and engagement have validated the project’s bottom-up approach.
Decentralization Reimagined
Most NFTs have value built-in by its creator. For example, if a famous artist mints his or her artwork as an NFT, the inherent value is derived from sensory appeal and the artist’s reputation. Loot Project flips the script by collecting value from the bottom up. As the loot community expands, it might create avatars, storylines, games, and more. Potential creations are only limited by people’s imagination.
As this infrastructure becomes more fleshed out, the original loot bags should increase in value because they will have actual use cases. The difference compared to other NFTs is that Loot’s use cases are being continuously built out by an active community. Now it starts making more sense why the price floor on loot bags is currently 8.5 ETH (~$29,000). Buyers are betting on their future value given an unlimited potential for value creation by the masses.
To aid ecosystem development, Loot Project founders have also created Synthetic Loot, which is a virtual form of loot that every wallet has access to. This allows any internet user to participate in future initiatives that involve Loot (such as to play Loot-inspired video games), without having to pay the expensive price tag for an original loot bag.
Regardless of Loot Project’s long-term prosperity, the launch is already an eye-opening spectacle. It has opened the gates for a paradigm shift in not only NFTs, but the future of digital inventions. Make the “thing” first, then have others make what it’ll be used for later.
