On their wanderings through the world the three gods Odin, Honir, and Loki come to a waterfall where an otter is devouring a fish that it has caught. Loki kills the otter with a stone, and they take off its skin. In the evening they seek a lodging at the house of Hreidmar, to whom they show the skin. Hreidmar recognizes it as that of his son, whom Loki has killed when he had taken on the form of an otter. Assisted by his sons Fafnir and Regin, Hreidmar seizes the three gods, and spares their lives only on the promise that they will fill the skin, and also cover it outwardly, with gold. Loki is sent to procure the ransom. With a net borrowed from the sea-goddess Ran he catches at the waterfall the dwarf Andvari in form of a fish and compels him to supply the required gold. Andvari tries to keep back a ring, but this also Loki takes from him, whereupon the dwarf utters a curse upon the gold and whosoever may possess it. The ransom is now paid to Hreidmar; even the ring must, on Hreidmar's demand, be given in order to complete the covering of the otter's skin. Loki tells him of the curse connected with the ownership of the gold. When Hreidmar refuses Fafnir and Regin a share in the treasure, he is killed by Fafnir, who takes possession of the hoard to the exclusion of Regin. In the form of a dragon Fafnir dwells on Gnita Heath guarding the hoard, while Regin broods revenge. From Odin is descended King Volsung, who has a family of ten sons and one daughter. The eldest son is Sigmund, twin-born with his sister Signy. King Siggeir of Gautland sues for the hand of Signy, whom her father gives to Siggeir against her will. In the midst of King Volsung's hall stood a mighty oak-tree. As the wedding-feast is being held there enters a stranger, an old man with one eye, his hat drawn down over his face and bearing in his hand a sword. This sword he thrusts to the hilt into the tree, saying that it shall belong to him who can draw it out again; after which he disappears as he had come. All the guests try their strength in vain upon the sword, but Sigmund alone is able to draw it forth. He refuses to sell it to Siggeir for all his proffered gold. Siggeir plans vengeance. He invites Volsung and his sons to Gautland, and returns home thither with his bride Signy, who before going warns her father to be upon his guard. At the appointed time King Volsung and his sons go as invited to Gautland. In spite of Signy's repeated warning he will not flee from danger, and falls in combat with Siggeir; his ten sons are taken prisoners, and placed in stocks in the forest. For nine successive nights a she-wolf comes and devours each night one of them, till only Sigmund remains. By the aid of Signy he escapes. The she-wolf, it was said, was the mother of Siggeir.