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Cryptocurrency’s enormous ecosystem of decentralized apps is one of its pillars (dApps). In the sectors of banking, entertainment, social media, and gaming, crypto dApps have the ability to better and possibly replace their centralized equivalents.
Then, comes the new revolutionary play-to-earn idea of Axie Infinity which is attracting more than 300,000 people to its virtual world every day, and the number is growing. Today, in my Axie Infinity review for 2021, I’ll go through what Axie Infinity is, how it works, how to profit from it, and if the AXS and SLP tokens are worth getting.
What Is Axie Infinity and How Does It Work?
Axie Infinity is an NFT game based on the Pokemon and Tamagotchi franchises. It is made up of millions of fantasy creatures known as Axies, who may be bred, nurtured, and battled.
Axies are divided into nine categories, which are similar to Pokemon types in that each has a fighting advantage over the others.
Water beats fire, fire beats grass and grass beats water to give a basic example. The real Axies battle matrix may be seen here:
In addition to categories, each axie now contains six of the roughly 500 potential bodily sections, each with three genes:
- Recessive
- Dominant
- Minor Recessive
When two Axies are mated, there is a 37.5 percent, 9.37 percent, and 3.1 percent chance that these genes will be handed down to the child, respectively. This equals 50 percent, with the remaining 50 percent coming from the other Axie.
Some physical qualities are more desired than others, and this varies depending on the Axie’s type and the combat build you’re employing.
The major takeaways are that Axies fight in three-person teams, and their battles may be tested against other players in the arena game style or non-player characters in the adventure game mode.
When your Axie squad beats an adversary in PVP(Player Versus Player) or PVE (Player Versus Environment), they receive a tiny quantity of smooth love potion tokens, often known as slp tokens.
To breed Axies, you’ll need SLP tokens as well as the AXS token, which I’ll discuss later. There is a restriction on the number of times an axi may be bred in order to keep the Axie population steady and sustainable. Currently, the quantity is 7, with each subsequent printing needing more SLP tokens.
Axie Infinity was initially created on the Ethereum network, with Axies being ERC721 tokens and SLP and AXS being ERC20 tokens.
As of April of this year, Axie Infinity is nearly entirely hosted on the ethereum-compatible Ronin Side Chain, which was built by Sky Mavis specifically for the purpose of hosting Axie Infinity.
Ronin is presently a permissioned blockchain, which means that sky mavericks have complete authority on it. Heavyweights like Ubisoft and Binance run Ronin’s validator nodes.
The basic idea of Axie Infinity is “play to earn,” and it follows this philosophy by compensating users for their time and work rather than draining them dry of every dollar they have, as other video games do. As you would expect, the slp tokens you earn by playing the game and from selling any additional Axies you breed that you don’t want or need are used to fund these incentives.
SLP tokens may be exchanged for other ethereum tokens on decentralized exchanges like uniswap or fiat on controlled exchanges like Binance.
Axie Infinity Background and History
Trung Nguyen, Alexander Larson, and Jeffrey Zulen created Axie Infinity in early 2018.
Trung was a finalist in the worldwide collegiate programming contest in 2014 and co-founded a multi-million dollar Vietnamese business when he was just 19 years old.
Alexander is the founder of some of Norway’s largest gaming communities and a competitive World of Warcraft and Dota 2 player.
Jeff has a Yale history degree and focused his research on early American monetary policies. Jeff is also a World of Warcraft player who was previously regarded as one of the finest in the country.
The three met in 2017 as a result of CryptoKitties, a famous NFT game that brought the ethereum blockchain to a standstill during the previous bull market’s high. After seeing how unsustainable CryptoKitties and other blockchain games were at the time, they came up with the idea for Axie Infinity in December 2017.
This is because none of these blockchain games understood how to align economic incentives for long-term success, and they continued stumbling when it came to finding the ideal market fit. Axie Infinity aims to alleviate these issues.
Between February and April 2018, the three sold over 3500 Axies for 900 ETH to get Axie Infinity off the ground. This equates to around 650K dollars, and I say sold since these Axies were legally adopted in return for ETH. Around the same time, the three established Sky Mavis, a for-profit software business based in Vietnam that develops Axie Infinity and provides a suite of blockchain gaming goods and services.
Since then, Skymavis has raised tens of millions of dollars via several fundraising rounds and token sales, which I’ll go into later.
Axie Infinity’s ICO (Initial Coin Offering)
Axie Infinity (AXS) started its Initial Coin Offering (ICO) on the Binance Launchpad in the late of October 2020, using a lottery mechanism.
From October 27th, 2020, Binance began tracking user BNB balances, with the process lasting seven days.
AXS’s ICO was hard-capped at $2,970,000 at the time of launch, with a total of 29,700,000 AXS (or 11% of Total Token Supply) allotted to the Binance Launchpad. The ICO pricing for AXS was $0.10 per token, with a maximum allotment of $200 in BNB tokens per winning ticket.
AXS has given lucky early-stage investors almost 700x in profits since its ICO in October 2020, but those who sold at AXS’s top of $76.96 would have received over 767x ROI.
Axie Infinity has been on the radar of several major IT companies, blockchain-based projects, crypto VCs, and individual investors since its inception. Ubisoft, MakerDAO Kyber Network, Samsung, HTC, and Binance are among the first partners of Axie Infinity.
Konvoy Ventures, Blocktower Capital, Libertus, Derek Schloss and Stephen McKeon of Collab + Currency, as well as the owner of Dallas Mavericks, Mark Cuban, who led a $7.5 million financing round in Axie Infinity developer Sky Mavis in May 2021.
The strong list of early-stage supporters, along with the most recent components of the newest funding round, all point to the Axie Infinity NFT gaming platform having a bright future.
How To Make Money Playing Axie Infinity and How To Buy Axie NFTs
Axies and other in-game products may be sold for ETH on the Axie Infinity marketplace, which can then be transferred to your preferred crypto gateway.
Based on the price of SLP, the caliber of your Axie spawn, and how much time you spend playing the game, you may make anywhere from $500 to $1,000 each month playing Axie Infinity.
Now, while this amount of money may not seem like much in most wealthy countries, it goes a long way in underdeveloped countries. While most of us were able to pivot in reaction to the epidemic, many individuals in poorer countries have had their wallets hammered into dust.
Hundreds of thousands of individuals have found Axie infinite to be a lifeline, particularly in the Philippines and Venezuela, where the majority of its gamers are situated.
Those who got in early, as is frequently the case with cryptocurrencies, reap the benefits, like one Filipino man who bought two residences with his axie earnings in mid-May.
If you’re asking how this may possibly be sustained, the answer lies in economics.
A Simple Axie Infinity Strategy For Beginners
Axie Infinity is a difficult game with several different ways to win. However, in order to make the game more accessible to newcomers, the creator has included some simple suggestions to assist players progress.
Here are a few strategies that novice players may utilize to help them win quickly.
Place a “tank” Axie on your side of the board in the front position. Axie who has 50 or more health and at least two cards with 70 or more shield is considered a “tank.”
Axies that can attack should be placed on two different locations. Axie with at least two cards of 100 attack or above is known as a “damage-dealing” Axie.
Plant, aquatic, and reptile cards are frequently the finest to use in aquariums.
Tanks can benefit from cards that allow an Axie to heal himself.
For damage-dealing Axies, bird and beast cards are frequently the best.
For damage-dealing Axies, speed, skill, and morale are all essential attributes, but health isn’t as vital as the others.
Axie Infinity Scholarships and Economy Explained
For starters, an Axie cannot be created out of thin air. To begin, you must purchase three Axies from the Axie Infinity marketplace. Better Axies, logically, costs more money, which can act as a barrier to entrance, especially because a competent Axie squad can easily cost more than 2000 US dollars.
Fortunately, the Axie Infinity community devised a solution to this dilemma in the form of scholarships.
This is when Axie managers lend their Axies to players who can’t afford to buy their own, in exchange for a percentage of any SLP earned by their scholar while playing.
This allows managers to make passive revenue from any unused Axies, while students may save money to purchase their own Axie squad.
Now, although this sounds fantastic in principle, putting it into practice is a little more difficult because there is presently no specific app or website to assist you in setting up these contracts. To my knowledge, everything is presently done peer-to-peer, and there are certain revenue limitations as well.
While the amount of slp you may win from battling other players is unlimited. In NPC adventure mode, you can only earn a certain amount of SLP every day. The logic behind this, I believe, is that while it’s improbable that you’ll win every combat against other players, you’ll nearly always win against NPCs.
This lowers the quantity of SLP produced each day. If you’re concerned about SLP inflation, it’s been taken into mind as well. As I previously stated, SLP is used to breed Axies, however this SLP is really burnt. When you consider how much it costs to do so for each Axie, you can see how the slp being coined to reward active players balances a significant amount of the inflation.
It also helps manage the Axie population because breeding new Axies is becoming increasingly expensive, especially when you consider the four AXS you’ll need to do so. Any AXS used for breeding, as well as 4.25 percent of all marketplace purchases, is donated to the community treasury instead of being destroyed.
Axie Infinity’s community treasury now has hundreds of millions of dollars in bitcoin, with more being added every month due to the game’s popularity.
The Token Economics of AXS
The Axie infinite NFT game uses an ERC20 token called AXS for governance. Axie infinity shards (AXS) are a cryptocurrency that can be purchased on a cryptocurrency exchange or earned by playing Axie infinity.
- The maximum supply of AXS is 270 million, which is distributed as follows:
- By either playing or staking AXS, you may earn 50% for in-game prizes.
- Sky Mavis is in charge of 8% of the budget for community growth and development.
- Sky Mavis and the crew get a 20% discount.
- The AXS private and public sales, which took place toward the end of 2020, received a 15% discount.
- Advisors receive 7% of the total.
AXS was sold for 8 cents per share to private investors and 10 cents per share to retail investors, raising a total of 3.8 million dollars. Different vesting timelines apply to AXS token allocations, which may be seen here:
It’s worth noting that 100 of the AXS sold to ordinary investors were instantly available, and AXS had a supply of about 60 million at the time. Aside from the AXS public and private sales, Sky Mavis has generated nine million dollars in venture capital investment and another four to seven million dollars through land sales.
Price Analysis of AXS & SLP Tokens
Let’s have a peek at the AXS and SLP charts.
AXS has had a strong month, and it makes me wonder how much higher it may go. In terms of how high AXS may go by the end of the year, I believe $200 is a fair forecast, particularly if Axie iInfinity continues to gain traction.
It undoubtedly helps that AXS has a medium market cap, which means it has a lot of opportunity to expand in comparison to other cryptocurrencies. Not only that, but due to AXS’s long vesting timeline, there is unlikely to be any significant price suppression from selling by the team, advisers, or private investors. With that stated, it’s unclear how many additional AXS will be released in the future as a result of playing and staking prizes. If the benefits are overly substantial, the price of AXS might plummet.
Now, luckily, tokenomics is a key priority for the Axie infinite team, as seen by SLP (Smooth Love Potion).
In contrast to AXS, SLP continues to rise against all odds and is on track to set a new high by the end of the year.
This is most likely due to the fact that SLP has no starting allotment. It was created from the ground up by Axie infinite players, making it a fair launch cryptocurrency, which is uncommon these days.
As a result, 100% of SLP’s supply is in circulation, and its modest market cap means it takes little money to move it up or down, which is why it’s included in Binance’s innovation zone for volatile assets.
More significantly, the quantity of SLP is divided extremely evenly on both Ethereum and the Ronin Side Chain.
Given these circumstances, I wouldn’t be surprised if SLP exceeded AXS in terms of percentage gains at year’s end. However, it appears that Axie Infinity’s land will be the major moneymaker.
How To Acquire Land In Axie Infinity
Some of you may recall hearing about the world’s largest digital land auction, which occurred in February of this year. That plot has a price tag of 1.5 million dollars. Lunacia, Axie Infinity’s virtual world, was the setting.
Despite the fact that the first ever property sale occurred in January 2019, Axie Infinity is currently in the process of launching Lunacia.
Lunacia, like Decentraland, has over 90,000 pieces of tokenized land called Terra that may be customized. Surprisingly, only approximately 17000 Terra will be held by players.
There are nine different varieties of Terra, as seen on the map. There are also roads, rivers, and natural resources. Unlike Decentraland’s initial land sales, Axie Infinity’s initial Terra sales require the purchase of land chests at a set price.
These may even be bought with FIAT, and two have already been sold. Terra chests are best thought of as a lottery ticket for a certain sort of land. If you’re lucky, you could obtain a plot of genesis land or a piece of land with uncommon things on it.
Another distinction between Lunacia and Decentraland is that the latter has Dungeons, NPCs and even the rule of law. The Lunacia website states, “According to the Lunacia website:
The fact that you may earn both AXS and SLP for performing activities and killing opponents is the most significant difference between Lunacia and other crypto worlds. Given the scarcity of Lunacia land in relation to the amount of players, this money will be quite useful. As a result, the cheapest parcel of land on the Axie infinite marketplace is $7000 in ETH right now.
Now, one guy who got to get their hands on some TERRA last year has cashed out with a 92x return on investment, but the most incredible aspect is that Axie Infinity is only getting started.
Axie Infinity Plans For The Future and What To Expect
The future for Axie Infinity is clearly laid out in its white paper, which also serves as documentation. The documentation is available here.
As you can see, Lunacia’s land features will be completely completed by the end of 2022, including a Lunacia SDK that will basically act as a map editor to make in-game content development easier. AXS staking is the next step for Axie Infinity, which will provide a new dimension of demand for the AXS token.
Surprisingly, VC company Delphi Digital is assisting Sky Mavis with the tokenomics of AXS staking, and they’ve even produced a paper on the subject, which you can read here.
While the specifics of AXS staking are still being ironed out, it appears that if you want to receive incentives, you’ll have to stake your AXS for a year.
Your AXS staking incentives will be based on how frequently you play the game and how often you vote on governance proposals and community treasury spending, so they won’t arrive automatically.
Another key milestone on the Axie infinite road plan is governance, although it will be some time before we see anything resembling a decentralized autonomous organization. Sky Mavis will retain the majority of voting power until at least 2023, according to Axie infinity’s own paperwork. This is to ensure that no malevolent actors ruin the game, according to co-founder Alexander Larson.
On that point, the Ronin Chain has been strained by the flood of players that have joined the game. Sky mavis hopes to make Ronin scalable enough to handle the hundreds of millions of users expected in the future.
To ensure Ronin’s security, Sky Mavis intends to make it a public blockchain, which means it will have its own token that validators and perhaps delegators may stake.
In a recent interview with Alexander, he emphasized that they don’t intend to sell the Ronin token to venture capitalists or whales. They want the Ronin token to end up in the hands of the community, just like SLP.
Details regarding the ronin token sale will be revealed shortly, but if Sky Mavis is to be believed, obtaining the Ronin Token will need a significant amount of AXS, SLP, and hours in front of the screen with your Axies. Consider yourself fortunate if you have a lot of all three.
Is Axie Infinity Legal?
The game, which involves growing and collecting mythical creatures known as Axies, appears to be quite safe for those who are unfamiliar with the hazards associated with such endeavors.
If you’re hesitant to buy/sell AXS and SLP on non-US exchanges or believe it’s a hazardous business, Axie isn’t for you.
AXS and SLP are not accessible on US exchanges at the time of writing. Their explanation may be that they did not fulfill the legal standards and other requirements set forth by US officials.
I can’t tell you why since I’m not a lawyer. To be fair, it’s possible that it’s because both of these tokens are so new.
When the IRS and SEC see individuals making a lot of money playing this game, you can guarantee they’ll want a piece of the action and start regulating it.
Axie Infinity does not have any Github connections to examine and verify its repositories and programs.
Many investors are concerned since Axie Infinity is not available on Twitter or on a Bitcointalk topic.
Only a simplified whitepaper,the official website, game support for PC and mobile phones, a Reddit page, and a listing on CoinMarketCap, Coingecko, and a few non-US crypto exchanges are available for Axie Infinity.
Final Thoughts
Axie Infinity is, in my opinion, one of the greatest cryptocurrency design initiatives. Everything has been thoroughly considered and executed, from the user experience to tokenomics.
This isn’t unexpected given that the company’s founders have been involved in game economics since they were children. The best thing is that they’re all committed to the cryptocurrency’s basic ideals. Their goal is to establish a virtual economy where people may own and manage their own businesses, save, invest, and spend money without ever having to go to a bank.
Axie Infinity’s in-game profits have kept tens of thousands of individuals afloat, and a few hundred have made life-changing sums of money. When whatever they developed was less than perfect for their users, they trashed it and attempted something new right away. This type of dedication to consistency, quality, and community is extremely unusual both within and outside of cryptocurrencies, and it is largely responsible for Axie Infinity’s success.
Blockchain gaming is maturing, and Axie Infinity shows us a sneak peek at what it may become.
