Loot (for Adventurers) – 3rd episode
If there is one non-fungible token (NFT) project that has caught the eye because of its originality, it’s Loot! If you’ve spent any time on Twitter, or even OpenSea in September, you’ve probably realized the importance that the news has brought to this unexpected work, to say the least.
In this series of 3 articles, Cryptoast invites you to explore various aspects of a project that has caused a lot of talk. So, make yourself comfortable and let yourself be told the story of Loot (for Adventurers) …
Economic diagnosis of the collection
While the first two installments in this series focused on the origins, ethos and development of Project Loot after its launch, this latest article provides a factual perspective on the economic activity of Project Loot (for Adventurers).
Measuring the development and activity of a collection requires easily accessible data in the Web 3.0 era.
As we will see, the analysis of the activity of Loot Bags from Dom Hoffman’s random generator indicates that interest in Loot weakens over time.
Collection activity graph – Source: Dune Analytics
To start, let’s see the activity graph offered on the OpenSea page of the collection. We can easily detect 3 phases:
At the end of August, the initial hype. Between enthusiasm and FOMO, individuals snapped up the freshly minted Loot Bags. Increase in transfer volume and floor price; In early September, the gradual loss of interest after the peak. Less and less transfers, the floor price falls; In blue, a peak in volatility due to a tweet from Dom on October 2. A sharp recovery drives the price up for a few hours.
This is a nice overview of the overall trend. After a swift adoption, the pulse of Project Loot (for Adventurers) slows. But this table alone does not weigh enough to constitute a solid argument.
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Dune Analytics data
These are the queries created by @colinplatt via Dune Analytics that will allow us to observe more closely the behavior of the participants. Note that this data only concerns the 8000 tokens of the original collection.
In addition, the group of individuals that we are studying are considered as economic actors: sellers and buyers participating in the process of expansion or contraction of the given market.
The conclusions brought here therefore do not concern the artistic, moral or symbolic values of the project and focus on the evolution of its economic aspect.
In the case of Loot, the market grew very quickly before gradually fading into oblivion.
Daily sellers / buyers chart – Source: Dune Analytics
Judging by the number of buyers and sellers every day, this trend can be seen very clearly:
Aug 28 – Sep 6: Many buyers enter the market, strong demand dominates; 7. Sept – 16 Sept .: Many sellers show up and leave the market; Since Sept. 17: The number of participants is gradually decreasing.
This graphic illustrates typical behavior. The dominance of buyers at the top then their abandonment a few days later, leaving them behind a sluggish market.
It is obvious from the daily sales volume. After a peak of 16,000 ETH on September 1, the volume drops drastically to reach 2,746 ETH on the 6th. A gradual plunge follows, indicating that fewer and fewer tokens are being traded.
Daily Sales Volume Graph – Source: Dune Analytics
Currently, the sales volume is struggling to exceed 30 ETH / day. With a floor price of almost 3 ETH, this means that on average 10 Loot Bags have been traded every day for several weeks.
This phenomenon is perfectly corroborated by the evolution of the size of the transactions, illustrated by the color transition of the bars of this histogram.
Transaction size graph – Source: Dune Analytics
Here again, 3 periods emerge:
Aug 27 – Sep 3: Strong increase in transaction size from 0.1 ETH per transaction to over 25 ETH per transaction; Sept 4 – Sept 9: stabilization between 3 and 25 ETH as the floor price adjusts and participants exit the market; Sep 10: Trade size stabilizes around the value of the price floor as the trade count shrinks.
For now, it looks like the overall commitment to Loot (for Adventurers) is waning.
Finally, let’s check whether new entities wish to take over. By observing the cumulative number of unique holders, we can put a word on the growth of active entities.
Graph of the number of unique portfolios – Source: Dune Analytics
After a strong influx of entities during the initial hype, stable growth is established as of September 5th. Therefore, very few new unique wallets will become Loot bag holders.
With an average of one new entity per day, this number stabilizes, a sign that the market is experiencing almost no newcomers.
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Yet endowed with an exemplary participatory ethos and an active community, the economic profile of the Loot project does not indicate reassuring signals.
Following the initial expansion of its market, the movement quickly lost momentum before wasting away and nothing bodes well for a change in the current trend.
Ultimately, these observations do not make Loot a laughable or utopian project. Despite an economic flop, Loot (for Adventurers) has won the admiration of many creators and reminds us that financial value does not necessarily reflect artistic merit.
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About the Author: Prof. Chain
On-chain analyst, fervent fighter in information asymmetry.
My goal is to inform everyone of the state of Bitcoin (as an asset and a distributed network) through the prism of on-chain analysis.
All articles by Prof. Chain.