Gold is called the 'otter-payment': Loki kills Otr (Hreiðmarr's son in otter-shape), and the Æsir must fill and cover the otter-skin with gold. Loki forces the dwarf Andvari to give up his hoard and the last ring, which Andvari curses to be the bane of every owner — the curse that drives the whole Sigurðr saga.
Hver sök er til þess, at gull er kallat otrgjöld? Svá er sagt, at þá er æsir fóru at kanna heim, Óðinn ok Loki ok Hænir, þeir kómu at á nökkurri ok gengu með ánni til fors nökkurs, ok við forsinn var otr einn ok hafði tekit lax ór forsinum ok át blundandi. Þá tók Loki upp stein ok kastaði at otrinum ok laust í höfuð honum. Þá hrósði Loki veiði sinni, at hann hefði veitt í einu höggvi otr ok lax. Tóku þeir þá laxinn ok otrinn ok báru eftir sér, kómu þá at bæ nökkurum ok gengu inn. En sá búandi er nefndr Hreiðmarr, er þar bjó. Hann var mikill fyrir sér ok mjök fjölkunnigr. Beiddust æsir at hafa þar náttstað ok kváðust hafa með sér vist ærna ok sýndu búandanum veiði sína.
What is the reason that gold is called the otter-payment? It is said that when the Æsir went to explore the world — Óðinn and Loki and Hænir — they came to a certain river and walked along it to a waterfall, and by the waterfall was an otter that had taken a salmon out of the fall and was eating it with half-closed eyes. Then Loki took up a stone and threw it at the otter and struck it in the head. Then Loki boasted of his catch, that he had taken both otter and salmon at a single blow. They took the salmon and the otter and carried them along, and came to a certain farm and went in. And the householder who lived there is named Hreiðmarr. He was a man of great account and very skilled in magic. The Æsir asked for night-lodging there and said they had food enough with them, and showed the householder their catch.
En er Hreiðmarr sá otrinn, þá kallaði hann sonu sína, Fáfni ok Regin, ok segir, at Otr, bróðir þeira, var drepinn ok svá, hverir þat höfðu gert. Nú ganga þeir feðgar at ásunum ok taka þá höndum ok binda ok segja þá um otrinn, at hann var sonr Hreiðmars. Æsir bjóða fyrir sik fjörlausn, svá mikit fé sem Hreiðmarr sjálfr vill á kveða, ok varð þat at sætt með þeim ok bundit svardögum. Þá var otrinn fleginn. Tók Hreiðmarr otrbelginn ok mælti við þá, at þeir skulu fylla belginn af rauðu gulli ok svá hylja hann allan, ok skal þat vera at sætt þeira.
And when Hreiðmarr saw the otter, he called his sons, Fáfnir and Reginn, and says that Otr, their brother, had been killed, and who had done it. Now the father and sons go at the Æsir and seize and bind them, and declare of the otter that it was Hreiðmarr's son. The Æsir offer as ransom for themselves as much wealth as Hreiðmarr himself will name, and it became a settlement between them, bound with oaths. Then the otter was flayed. Hreiðmarr took the otter-skin and told them that they must fill the skin with red gold and also cover it all over, and that this should be their settlement.
Þá sendi Óðinn Loka í Svartálfaheim, ok kom hann til dvergs þess, er heitir Andvari. Hann var fiskr í vatni, ok tók Loki hann höndum ok lagði á hann fjörlausn allt þat gull, er hann átti í steini sínum. Ok er þeir koma í steininn, þá bar dvergrinn fram allt gull, þat er hann átti, ok var þat allmikit fé. Þá svipti dvergrinn undir hönd sér einum litlum gullbaug. Þat sá Loki ok bað hann fram láta bauginn. Dvergrinn bað hann eigi bauginn af sér taka ok lézt mega æxla sér fé af bauginum, ef hann heldi. Loki kvað hann eigi skyldu hafa einn penning eftir ok tók bauginn af honum ok gekk út, en dvergrinn mælti, at sá baugr skyldi vera hverjum höfuðsbani, er ætti. Loki segir, at honum þótti þat vel, ok sagði, at þat skyldi haldast mega fyrir því sá formáli, at hann skyldi flytja þeim til eyrna, er þá tæki við.
Then Óðinn sent Loki to Svartálfaheimr, and he came to the dwarf named Andvari. He was a fish in the water, and Loki caught him with his hands and laid on him as ransom all the gold he owned in his rock. And when they come into the rock, the dwarf brought forth all the gold he owned, and it was a very great treasure. Then the dwarf swept under his arm one little gold ring. Loki saw that and told him to hand over the ring. The dwarf begged him not to take the ring from him and said he could breed himself wealth from the ring if he kept it. Loki said he should not keep a single penny, and took the ring from him and went out; and the dwarf said that that ring should be the death of everyone who owned it. Loki said that seemed good to him, and said the curse might well hold for this reason: that he would carry it to the ears of those who received it.
Fór hann í braut ok kom til Hreiðmars ok sýndi Óðni gullit. En er hann sá bauginn, þá sýndist honum fagr ok tók hann af fénu, en greiddi Hreiðmari gullit. Þá fylldi hann otrbelginn, sem mest mátti hann, ok setti upp, er fullr var. Gekk þá Óðinn til ok skyldi hylja belginn með gullinu, ok þá mælti hann við Hreiðmar, at hann skal sjá, hvárt belgrinn er þá allr hulðr. En Hreiðmarr leit til ok hugði at vandliga ok sá eitt granahár ok bað þat hylja, en at öðrum kosti væri lokit sætt þeira. Þá dró Óðinn fram bauginn ok hulði granahárit ok sagði, at þá váru þeir lausir frá otrgjöldunum.
He went away and came to Hreiðmarr and showed Óðinn the gold. But when he saw the ring, it seemed fair to him, and he took it out of the treasure, and paid Hreiðmarr the gold. Then he filled the otter-skin as full as he could and set it up when it was full. Then Óðinn went up and was to cover the skin with the gold, and then said to Hreiðmarr that he should see whether the skin was now all covered. But Hreiðmarr looked and considered carefully and saw one whisker-hair and told him to cover it, or otherwise their settlement was ended. Then Óðinn drew out the ring and covered the whisker-hair and said that they were then free of the otter-payment.
En er Óðinn hafði tekit geir sinn, en Loki skúa sína ok þurftu þá ekki at óttast, þá mælti Loki, at þat skyldi haldast, er Andvari hafði mælt, at sá baugr ok þat gull skyldi verða þess bani, er ætti, ok þat helzt síðan. Nú er sagt, af hverju gull er otrgjöld kallat eða nauðgjald ásanna eða rógmálmr.
And when Óðinn had taken his spear, and Loki his shoes, and they need fear nothing, then Loki said that it should hold, what Andvari had said, that that ring and that gold should be the bane of whoever owned it — and so it held afterward. Now it has been told why gold is called otter-payment, or the Æsir's forced ransom, or strife-metal.