Spoiler warning: This section may contain information that could spoil the story line or displays in depth quest or fight details.
Make your way to the Searing Cauldron. There are only a few beetles around, but lots of other monsters. In fact, you may only see the one you have to defeat to get the Bloodsoaked Sword.
The beetle dropping the sword can be found in the big pit on the west side of the area, in the location E-5 in the Searing Cauldron. Once you have the blade, you are redirected to Baaluk for a little chat and your reward.
Spoiler warning: This section may contain information that could spoil the story line or displays in depth quest or fight details.
Gossip
Athlum
Pleasant Young Man: "Some guy out in the Great Sand Sea's been looking for challengers. But he's not interested in Joe Schmoes off the street. ...That's the story, anyway."
Bartender: "Mmm, dangerous men are so intriguing! I bet we could go head-to-head in a few different "challenges"..."
Baaluk
Lively Old Man: "Some guy out in the Great Sand Sea's been looking for challengers. But he's not interested in Joe Schmoes off the street. ...That's the scuttlebutt, anyhoo!"
Bartender: "Izzat so. And?"
Lively Old Man: "And so I was gonna go give that guy a real challenge, but the wife got a migraine so I figgered I better stay here... Gahahahaha!"
Balterossa
Bartender's Daughter: "A man in the Great Sand Sea's been looking for challengers for some sort of game. But apparently he only wants really special people to play. That's the latest news, Daddy."
Bartender: "Some "game" with some man!? No, oh no. That's it, daughter, I forbid you from going to the desert. Don't even get close!"
Bartender's Daughter: "A-Alright..."
Celapaleis
Gossipy Girl: "Some guy out in the Great Sand Sea's been looking for challengers for some sort of game- but he seems the type not to deal with regular people. That's the latest scoop, anyway!"
Bartendress: "Well then, let's not deal with him, either."
Gossipy Girl: "Works for me!"
Elysion
Mysterious Part-Timer: "Some fellow is hosting a game in the Great Sand Sea. I wonder how many people are gonna join in the fun. Interesting, huh?"
Bartendress: "He has the right idea! Life is all about fun."
Mysterious Part-Timer: "...Strange, coming from a seedy barkeep like yourself."
Ghor
Mercenary With a Past: "Someone is hosting a game out in the Great Sand Sea, sir! I wonder how many people are up to the task. Sir! What do you think of this?"
Bartender: "I'm intrigued. I've never backed down from a challenge."
Mercenary With a Past: "I'll hold this place down, sir!"
Melphina
Noob Qsiti: "Some fellow is hosting a game in the Great Sand Sea, sir! I wonder how many people are up to the task. What's that about?"
Bartender: "You haven't heard? I think he's doing it out of boredom, if anything."
Noob Qsiti: "You know everything!"
Royotia
Passionate Miner: "Some guy out in the Great Sand Sea's been looking for challengers for some game. Seems like they've gotta be pretty impressive, too. An' that's the story!"
Bartender: "Harumph harumph... harumph! Game-playing man... you, too, are my rival!"
Passionate Miner: "You don't even know what the game is..."
Dishonest-Looking Man: "*sniff sniff* Well, somebody smells like blood. Nah nah, don't run off. The stink of blood is the aroma of life! It ain't a bad thing. Say, kid, howzabout we play a little game? Or are ya too much of a papangu to have some fun? Sweet. Here's how it works: you go to the Great Sand Sea, and ya crunch Grand Beetles, 'til you get the Bloodsoaked Sword. If you can bring me back that sword, I'll give you something real nice. See? Told ya it was easy! Oh, and if you can't find it? Then I'm gonna kill ya! So, whaddaya say? Yer up for my little challenge, right?"
Rush: "Wha... no!"
Dishonest-Looking Man: "Wha-a-at? And you call yourself a man? Bawwwk-bawk-bawk-bawk-bawk!" (And they say Wyngale is insane...)
or:
Rush: "You bet I am!"
Dishonest-Looking Man: "Attaboy, that's the spirit! Time's up once I get sick of waiting for you to come back. Go kick ass, kid!"
We go, we kick, we're back.
Dishonest-Looking Man: "Ohh ho ho ho. Finally, the Bloadsoaked Sword! Too bad time was up five minutes ago. Well then! Time to take your life! What're ya looking at me like that for? We agreed the time limit was whenever I got tired of waiting for your slow ass. Be faster next time! Oh wait, there won't be one! Ice burrrrn! Say your prayers, kid! Next stop for you is six feet under! ...Psych! Haw haw haw, you shoulda seen your face! You're lucky, kid - until the old man gets stuff started, I'm off the clock. I'll let you go for now. Get ready to put up a fight next time, eh? Ah, and here ya go, just like I promised. Fight ya later!"
Quest Log[]
Spoiler warning: This section may contain information that could spoil the story line or displays in depth quest or fight details.
Completed:
This shady guy came up to me and dared me to get a Bloodsoaked Blade from a Grand Beetle in the Great Sand Sea. Piece of cake!
It looks like I lost the dare... But the guy gave a raincheck on that killing me stuff. Weird guy... Says he'll see me later--not if I see him first!