Team Fortress 2 and CS:GO were early pioneers of current micro transaction models. Arguably the “loot box” was popularized by crates and boxes from TF2. Players would receive crates through casual play on any server. The crates could be unlocked with keys bought for 1.50 each.
This model was brought to Valves free to play release DOTA2, where it further cemented the concept in the public awareness.
TF2 definitely feels to me like the origin of widespread loot boxes in gaming (The actual origin appears to be MapleStory in 2004, and the appearance of widespread free to play social network games with loot boxes does slightly predate their inclusion in TF2. I’d definitley blame Zynga more than Valve for the current state of affairs personally). By the time DOTA2 came around though they were already so prevalent that I don’t think their inclusion changed much of anything though.
MapleStory had a "cash shop" in 2004, not loot boxes. Very common design at the time, it was just an in-game store that only took real money in return for items. MS was actually somewhat famous at the time for having a fair, cosmetic-only cash shop (which has now since changed)[0].
PCGamer [1] puts "ZT Online", a Chinese MMO, as starting the lootbox trend in 2006.
[0]: Albeit, this is all coming from my experiences on the Global MapleStory servers. The Korean ones could have been different
It’s actually the Japanese version of MapleStory that first had the “Gachapon ticket” in 2004, which gave random in game items and cost real money. (While it seems to have been ported to other versions later on, I can’t figure out when that happened). ZT Online is definitely closer to the modern loot box model. While they also didn’t have loot box unique items, they had the model where you used keys to open chests bought with real money. Additionally enemies didn’t drop items in the game, instead it was a combination of buying materials and smithing. This apparently made gambling with keys to get items directly very compelling in comparison. Opening a chest was also rigged in a way where a wheel span on items you could get, but the appearance rate of valuable items was more common than the rate at which you would actually land on them.
Definitely TF2 and the infamous "hats". Other games may have sold cosmetics, but none truly gamified it like Valve. They even had a proper economist [0] whose whole job was to tweak and optimize the system to make as much money as possible. In 2011, they switched TF2 from paid to F2P, which also was a huge step forward for the microtransaction model. CS:GO soon followed suit.
This model was brought to Valves free to play release DOTA2, where it further cemented the concept in the public awareness.