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I like this! The calm feeling, due to the silences and soft instruments, fit the hot spring theme well. I also like the change at 1:06 to a bit more full composition, yet keeping the silence in there. I can totally feel this in an Animal Crossing (and even Pokemon) setting! And yes, the loop works nicely ;)

I read that a section was recorded live - that answers my intuition, as some parts at the start were slightly off-rhythm and had different arpeggio-speeds. Nice job! Overall, well done :D