Warning: Contains spoilers for Marvel’s What If…? episode 7.
Loki’s presence, or lack thereof, in The Watcher (Jeffrey Wright) elaborates on what each change is that has happened in that universe compared to the main MCU timeline. His explanation here would not allow for the changes that have been made to Loki’s origin story.
In What If…? episode 7, instead of raising Loki (Tom Hiddleston) as his own son, Odin returns him to his father, Laufey, shortly after the battle. This allows Thor (Chris Hemsworth) to grow up unchecked by his brother and results in Party Thor. Loki makes an appearance later on in the episode as a fully grown frost giant who has developed a strong connection with Thor and winks to the audience about the change by calling him his “brother from another mother.”
In Thor movie. When Odin finds Loki as a baby, he is a runt by frost giant standards. His growth into a full-sized frost giant that towers over Thor shouldn’t happen. More importantly, Odin notes that the child had been abandoned. Laufey had abandoned Loki because of his small size suggesting he was seen as unworthy to be raised as a prince and instead left to die. Laufey’s response to having Loki returned to him by Odin would not have been one of joy, as is depicted in What If…? and likely would have resulted in the baby being abandoned once again.
While it was in part fueled by pity for the baby, fully grown ice giant Loki. However, that is not marked as a difference for this timeline.
One thing that What If…? notably does keep consistent about the MCU is that Odin’s plans often appear to not have been the best course of action. Keeping Loki’s past and the existence of Hela secrets from his sons ultimately backfired and caused large-scale wars, for example. What If…? suggests that if, instead of enacting his scheme to unite Asgard and Jotunheim by stealing a baby, he had returned Loki to Laufey then the goodwill would have done a better job of uniting the civilizations as demonstrated by Loki and Thor’s close friendship.
Marvel’s What If…? releases new episodes Wednesdays on Disney+.