In this beginner’s guide, you will learn what Axie Infinity is, how to play Axie Infinity, and how you can make money playing the popular blockchain game. With Pokemon-inspired concepts and excellent play-to-earn (P2E) features, the game boasts over a million players, many of which are making money while having fun. Making positive adjustments while maintaining economic stability is key to increasing the longevity of Axie Infinity.Axie Infinity is one of the most prominent blockchain games available in the market today. One wrong move might see the game fall into a death spiral. This would increase the number of $SLP burned and it will reduce the net issuance of $SLP.Ī combination of reduction in supply and increase in demand would theoretically help maintain price stability.Īll in all, there are many factors to take into account when implementing changes to the existing economic model. This would effectively reduce the $SLP emission and significantly reduce the net issuance of $SLP.Īnother recommendation is to increase the demand of $SLP by increasing the number of $SLP needed to mint and breed Axie. One notable recommendation is to reduce the in-game $SLP rewards. This issue can be solved by tweaking the economic model to dampen the supply while increasing the demand of $SLP. The team have yet to decide how to balance the economy. This is detrimental to the ecosystem as the net issuance of $SLP into the economy negatively impacted the price. In the second half of 2021, the number of $SLP minted consistently outpaced the number of $SLP burned. Economic balancing Image Credit: Axie Infinity This includes crypto giant Binance and top decentralised exchange Uniswap. This burning mechanism would form a positive feedback loop as more Axies are minted and bred, more $SLP would be burned and the price of the token would skyrocket which result in an increase in the profitability of the game and hence promote the breeding of Axie.īoth $AXS and $SLP can be purchased and sold in many centralised and decentralised exchanges. The value of $SLP is tied closely to the in-game sentiment. Furthermore, more $SLP is needed each time an Axie breed. $SLP tokens are burned and taken out of the circulating supply whenever an Axie is minted. $SLP is the native in-game currency of Axie Infinity and players are rewarded with $SLP whenever they win a battle.Īs there is an unlimited supply of $SLP tokens, some in-game mechanisms are introduced to curb inflation. Smooth Love Potion ($SLP) Image Credit: Axie Infinity
$AXS also allows the holders to participate in governance and vote on proposals, it is how Axie involve the community and allow them to influence and shape the future of the project. The yield paid out is generated from fees paid by players that made transactions on the Axie Infinity marketplace. Players are able to stake $AXS within the governance platform to earn yield. It is an ERC20 governance token with a max cap of 270 million tokens. Axie Infinity Shards ($AXS) Image Credit: Axie InfinityĪXS is the primary token of Axie Infinity. The price fluctuation of the governance token would not affect the economic mechanism of the in-game token and if things go south, it would not cause the whole in-game economy to crash. By separating the single token into a governance token and an in-game token, it helps to reduce the impact of the secondary market on the game. This essentially creates FUD among the community and cause the game to fall into a death spiral as players start selling token in fear that the price would drop even further.ĭual-token economics on the other hand fixes the weakness of the single-token economy. The profitability of the game is tied to the token price and when a large quantity of the tokens is sold, players would lose motivation as the income starts to drop. However, this economic model is prone to failure. Furthermore, it also helps to increase the token price and profitability of the game as the flow of funds is concentrated into a single token. It is easy to onboard new players as the tokenomic is straightforward and easy to understand.
The advantage of using a single token is its simplicity. dual-token economics Image Credit: Axie InfinityĪ single-token economy is the use of a single token for every function of the project, it ranges from governance to the whole in-game economy. It all boils down to single vs multi-token economics.
The primary token is usually the governance token and the secondary token will be used for in-game mechanics.īut this begs the question of why there is a need for two different tokens in a single game. The dual-token model will see a primary token and a secondary in-game token. Following the most successful play to earn game Axie Infinity, many GameFi projects have started to adopt its economic model and apply the dual-token model.