Anonymous construction worker and Superhorse were just about to finish ahead of deadline when the gods decided to stall him so they wouldn't have to pay. Clearly the way to do this would be to have Loki take the form of a mare to lure the builder's horse away from his work. Sexually.
As opposed to, you know, shooting it. Murderally.
Most stories say Loki thought he could outrun the stallion. He could not. He got fucked by a horse. All to keep his buddies from owing some guy money. Oh, yeah, and he got pregnant. With an eight-legged horse.
All the saints and grape juice in the world don't hold a candle to the murderhorse.
It Gets Weirder
The horse he gave birth to grew up to be Odin's horse. Imagine if you got raped by an animal, got pregnant and had a son. An eight-legged monster-horse son. And your friend saw him and said something like, "Hey could I have that? He could sleep at the foot of the bed!" That's the kind of weird relationship Loki and Odin had.
Artist depictions get a little insane at this point.
Another of Loki's sons, a goddamn wolf, ultimately killed Odin. And his third son, a giant snake, killed Thor. These two sons have the same mom -- a giantess. The thing to take home here is that if it stood still long enough, Loki would fuck it.
The best gods are into bondage.