Looks Rare?

Bart Eggermont
5 min readFeb 10, 2022


Once upon a time in Blockchain space

In 2017 there were these weird cats that took the crypto world by storm. The Cryptokitties were born and they really took this novel idea of digital blockchain-enabled scarcity to the masses. Prices sored but something was missing. The project is still there, 4 years later but not on the level it once was.

First come first serve

Along came Opensea in December of 2017. They built the first real NFT marketplace and like a lot of first movers, they really cornered the market. Alternatives were created but those were platforms that were used to highlight rarity or collection power. Most people went back to Opensea for selling and buying just because most people were there. The company delivered what the market needed and proceeded to grow exponentially. Several funding rounds were raised and the last 300 million USD investment round puts the company at a value of about 13.3 Billion USD.

So the NFT scene grew and its biggest company is a centralized company built with VC money. Most crypto users could not care less, they want to buy, sell and flip their collection and get rich quickly. WAGMI

A lot of 3rd party integrations like the NFT Tab on Coinstats, or the NFT valuation on Metamask just use the Opensea API and show it as “the truth”. This centralization and dependence of others on top of the company being a victim of its growth which led to bad customer service and slow development started to rub the NFT bros the wrong way.

NFT marketplace decentralization

On 10.01.2022 a lot of people were turning to Twitter (https://twitter.com/LooksRareNFT) to see if this $looks airdrop was a scam or not, was this real and how did it work?

It seemed too good to be true, a marketplace that would share all its fees with the tokenholders. And if you had traded over 3 ETH with one address on Opensea in the history of your NFT explorations you had the right to a free airdrop.

75% to the Community

That alone is a very generous allocation which is in the spirit of most crypto protocols, teams, and projects. After the 12% airdrop, we switched to the staking and trading rewards, and here it got a bit murky in the eyes of some.

This kicked of a new opportunity for some. Buying and selling no commission collections to farm the trading rewards. The cost was the 2% exchange fees and the ETH transaction fees and the reward was a whole lot of Looks tokens. The debate of whether this is right or wrong is another story but it does have one upside which brings us to the next part.

The exchange charges 2% fees

The amazing thing is that all of the fees are shared with tokenholders which in turn also feeds the treasury and pays the team who both possess 10% of the total token amount. Which is a big stimulus for the team to deliver and make the product better.

So in the beginning the fees were mainly generated by the huge amount of wash trading taking place and this allowed for roughly 600% ROI on the first month. This brings us to the end of the first phase and into the first halving.

This phase change will, in my opinion, give 3 options.

  • The wash traders quit, ROI from the trading fees drops dramatically and there is a huge sell-off going onto lower token value due to lower rewards. This is a continuous downward spiral
  • The wash traders quit, ROI from the trading fees drops dramatically and there is a huge sell-off leading to lower token value due to lower rewards. This is slowly offset due to more usage from regular transactions and we slowly grind higher with organic growth due to the delivery of a superior product (in progress) and community support.
  • The wash traders stay, do not sell-off and the token value soars due to the lower emissions (see BTC first few halving cycles) which makes it still worth it to keep farming tokens.

My personal opinion

Personally I see all options as not being desastrous from an investment perspective for myself. I was lucky enough to get a small airdrop and have purchased more tokens along the way as I learned more about this project. The token price is not the real return for me, it is the fee split which is what I am interested in.

  • If the whole project dies a slow death in the next year I would assume to get my ETH investment back over a longer period of time.
  • If Looksrare takes off and finds its place in the market I would assume it will be here for the long run and the ETH will pay itself back multiple times over and provide me with a nice stream of additional passive income. I am of course positive that this is the future and plan to hold my Looks with true Diamond hands

One day after the Halvening it seems that the token is holding up quite well and the WETH ROI is still delivering 150% per year. I guess I am not putting my money back in my savings account at the bank any time soon…

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