Loot Community Synopsis

This is the seventh of a series of 12 discrete stories about how a variety of web3 projects (ranging from crowd-funding platforms and NFTs to DeFi and gaming) have approached decentralized community building. You can read an aggregated overview of insights across all of these projects here.

Fully Decentralized ⬤ ⬤ ⬤ ⬤ ⬤ Fully Centralized

On August 27, 2021, 8,000 black boxes with lists of objects in plain white text were introduced in a single Tweet. These are Loot bags, said their creator Dom. “Mint at your own risk.”

Like trading cards in a player’s deck, each listed a seemingly random assortment of items and surreal treasures: Amulet of the Twins, Pendant, Bronze Ring, Crown, Long Sword, Divine Robe of the Fox. That’s all it took to transfix an online builder community. Within days, bags of Loot spiked from the mint price of .08 ETH to 12-45 ETH, with one particularly “rare” bag going for 250 ETH (upwards of $800,000 at the time).

Two important key decisions contributed to their early traction:

1. To launch Loot as a CC0, or public utility, meaning anyone to build on top of it; and

2. To make Loot free to mint with 0% royalties.

This not only attracted initial collaborators to the project but also established Loot cards as the atomic unit of that ecosystem: “minimum viable world building,” if you will. Thus, the Lootverse was born.

One community quick to emerge came out of the rarity of one item in particular: Divine Robes, which only appear 500 times in the 8,000-card deck. Others quickly followed suit to fill in the blanks where Dom left off – with groups like Hyperloot deriving a project around what the characters, the Realms team introducing the land of the universe, and Adventure Gold conceptualizing a currency. Alec Taggert launched DivineDAO in October 2021 to direct some of that energy toward a shared community to build infrastructure around the Loot ecosystem. And this emergent way of building has continued ever since.

I asked Conway Anderson, an early Loot adopter, why he thought their origin took off. He said: “Loot was this primitive that got everyone to ask, ‘What are these items? Where do they come from? What game do they come from? It’s a pre-revenue startup. People saw it and thought: “This could be what GameFi is all about, this could be it.”

As the first ever community-owned NFT gaming platform, the most notable byproduct to come out of Loot was not the promise of wealth accrual (the price and hype around Loot bags has cooled substantially since those early months) but the power and potential of what may come next in this ecosystem. The best description of the current state of Loot is in this Twitter thread from core ecosystem contributor, Timshel, from late July 2022. Here’s an excerpt:

If you think of Loot as “on-chain scaffolding for a massively-multiplayer collaborative world-building experience,” then the Lootverse is the ecosystem that surrounds it – all of the stories, games, art and media – suggests Timshel.

“Loot has no owner — together we all own the Lootverse

Loot has no team — we are the Lootverse team

Loot has no roadmap —  Our collective dreams are the map, and the things we build become the roads of the Lootverse”

This is, in many ways, the big-picture goal of an open-source, decentralized ecosystem. This overview deck from June 2022 notes that there were approximately 26,000+ holders of Lootverse NFTs and 75+ active builders across 25 active teams contributing to the Lootverse community. The collective treasuries of Lootverse communities (including Loot, Bibliotheca, Genesis Project, and Divine DAO), reflects about 1,000 ETH overall. Taking Bibliotheca as an example, each project has its own game play structures, Discord, documentation, incentive models, and governance.

While Loot is almost certainly among the purest form of decentralized projects to date, this truly emergent system is not without its challenges. The shared dream of bringing about “high-fidelity world-building” moves in many directions at once, without clearly defined frameworks, owners, or intentions. But that in itself represents a unique opportunity to lean into the “magic of deriving,” an invitation among builders to invent their own possibilities and create together.

Today, the Loot Foundation has become the de facto “librarian” and custodian of the state of Loot – a role that will certainly shift and evolve over time as the entire Lootverse remains in a perpetual state of fluidity.

Like other nascent web3 experiments with early traction, much of the initial buzz was also due to Dom’s pre-existing reputation in the space. Best known for starting Vine, the 6-second video clip social media platform, in 2012, he’s no stranger to online virality and has since turned his attention to a variety of web3 projects. Given that Dom’s audience was heavily weighted toward web2 builders who’d started building in this web3 space, the project already had a great foundation, even before it began.

But aside from guaranteeing an early audience, there’s no denying the collective “aha” moment that Loot unlocked for a generation of world-builders and gamers. As Timshel explained, the idea of “decentralized IP” around bottom-up, collective world-building is an incredible opportunity to invert the incentive structure among beloved brands: “Like Star Wars, Game of Thrones, Harry Potter, Dune…but instead of being owned by Disney and HBO, owned by the community and players and builders.”

In a presentation from July 2022, a Lootverse contributor known as Glosso Aiya K. proposed that Loot has spawned an entirely new artistic aesthetic called emergent art. That’s to say, rather than simply enjoy art as a spectator or participant, Loot compels people to build the “emergent whole” – the currencies, the maps, the stories, the lore – around just a single atomic unit, or “primitive.” When reflecting on how the Lootverse came to be, Glosso Aiy K noted:

“This process is a very different relationship with an artistic object because the people that came to these loot contracts were more like archaeologists. They dig apart for all of these different clues and develop this interpretation of the nature of the Loot cosmos.”

Over time, as more experimentation occurs, his belief is that Loot will invite as much creativity and reinvention as the entire film genre has done for our consumption of media and art.

Anyone can spin up a derivative Loot project, launch a DAO or community around it, and build.

Loot holders govern the treasury of royalties (which is small because Loot’s royalty was set to 0% for about 97% of Loot’s trading volume), but holders don’t govern who can do things with Loot or what constitutes canon. As a whole, the Lootverse grows and evolves as a natural manifestation of the community’s will – through bottom-up traction and open frameworks.

• Emergent community-building from other grassroots projects

• Hype, mystique, and FOMO that led to a groundswell of traction

• Founder recognition & reputation from day one (builders want to build with other great builders on something that hasn’t been done before)

As perhaps the most decentralized of all projects I studied in this research, the very nature of its pure decentralization also presents challenges of its own. There is no single entity or owner of Loot and there are no inherent royalties or treasuries built into the platform design, which means that those who participate and build in the ecosystem are, to a large degree, simply donating their own time and effort. The flip side of this, of course, is that those who are attracted to this project are incredibly aligned with the purpose and vision of the overall community. This dynamic lends itself to other opportunities and possibilities in the future. As Timshel says:

“And, as cliche as it sounds, we became friends along the way. Even beyond Loot, like a PayPal mafia, the builders of the Lootverse have gone on to plant the seeds of the expansive hyperverse — the on-chain, Web3-native consumer internet. And it’s only just begun.”

Special thanks to Timshel and Conway Anderson for their contributions to this narrative. You can also view the complete repository of articles and references across all projects as part of this study.