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Is there a bigger, deeper story behind the name of this lake? I am aware that in-game lore refers to Alatar as a wise sage at some point in history that also became famous to the point of having a lake named after him. It is known that he was also the teacher of NPC Loria which walks around the lake. Was Alatar a player from the early days of the game who helped GMs and received this homage? Was he a GM himself?

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Alatar's Lake is a clear reference to the book - Lord of the Rings. Alatar was one of the Maiar, and actually was chosen to be one of "Order of Wizards"- among of: Gandalf, Saruman, Radagast and Pallando). He and Pallando were called "The Blue Wizards" as they were wearing a Blue robes.  It is said that The Blue Wizards might have created cults for magic worship and practice2 - but their fate is unknown, as it seems in Tibia also...;-)

Possibly, following this path you can connect him to Arcane Staff    3 and Blue Robe  4 from the game. (Speculative though).

1. https://lotr.fandom.com/wiki/Alatar 

2. https://lotr.fandom.com/wiki/Wizards

3. https://tibia.fandom.com/wiki/Arcane_Staff

4. https://tibia.fandom.com/wiki/Blue_Robe

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