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Axie Infinity: From video games to wages?

besancia
besancia
2021-08-03
With the rise of Axie Infinity popularity, the concept behind Play to Earn is expanding. But for some, it goes much further than just the concept of a video game.
With the rise of Axie Infinity popularity, the concept behind Play to Earn is expanding. But for some, it goes much further than just a concept!

Introduction

Play To Earn was accepted into the blockchain sector very early on using Bitcoin. With quests, rewards, farming, tournaments and competitions, rewarding players’ efforts in crypto prizes. These type of games were relatively numerous but several technical aspects prevented the massive adoption of this innovation.

Since the start of 2018, the wish to reward players in a game using Non-Fungible Tokens as a reward emerged in more and more studios followed by increased pre-sales taking place to finance projects.

Thanks to the pre-sales’ reliance on the use of blockchain, buyers and investors were able to obtain assets that related to their purchase and then exchange and profit with them on the secondary market. But while the developers were busy creating a new style of gameplay, it was the community who likely best understood the ideas of new possibilities that the concept behind Play to Earn could inspire.

Have players become workers 3.0 and what are the peculiarities of this alternative economic system?

A short history of Axie Infinity

In the crypto world It’s hard not to have heard about the success of $AXS or $SLP, especially over the past few months. The growth percentage of the three-digit token, and it’s exponential increase in the number of users…but the most compelling aspect is the scholarship system that has been put in place.

Before going into more detail in this system, let’s take a closer look at the journey of the Axie Infinity community which, let’s remember, was formed in the middle of a bear market.

2017 : The idea

axie infinity idea

Somewhere in the Vietnam, a team of developers had noticed the spectacular craze for CryptoKitties and Decentraland despite the staggeringly high Ethereum transaction fees at the time and they decided to commit to paper an idea that would change their lives forever: Axie Infinity.

During the time it took to write their Whitepaper and create a legal entity, Sky Mavis, the market had collapsed and the general public had lost interest in the crypto universe which had proved to be too volatile for their taste.

But for those who had taken a close interest in CryptoKitties, the potential of the ERC-721 standard that had been accepted in early 2018 was undeniable: In addition to actually owning an asset and trading it on a secondary market, it was now possible to obtain it as a reward for efforts and time spent participating in a project.

2018 : Launch

When Axie launched its first presale, the average price of newly created Axies was around just a few dollars. Another way to get them was to participate in giveaways or raffles on social networks.  These practices were necessary for several reasons:

  • Visibility on marketplaces like Opensea
  • Promotion of the project through the community
  • Awards of “early adopters” for the investment of time and effort in the development of the project

This balance was necessary for everyone: on one hand users were looking for ways other than trading to earn cryptos and on the other hand, developers needed passionate users to understand their needs and expectations in order to offer a fun experience best suited to this new market.

2019 : Lunacia

axie infinity battlefield

Indeed the Sky Mavis team sees things much more broadly than just all these little Axies. They needed an entire universe of their own where they could live out incredible adventures. During 2019 in January, 17,217 plots of land (LAND) were sold for a total of 3,200 ETH (approximately $416,000), laying the foundations for Axie Infinity’s metaverse: Lunacia.

Anticipating the scalability of the project, 2019 will be marked by the migration of Lunacia universe assets (personalisation objects and terrain) onto the second layer, Loom Network, while Axies will remain on the first layer of Ethereum.

Tournaments and partnerships follow on from one another and the community grows while consolidating day by day with Axies still exchanging for just a few handfuls of dollars.

The true novelty of the game arrives at the end of the year with a gameplay alpha update: automated combat that leads the way to a new choice of skills to use during the fights.

2020 : Lockdowns and growth

The year 2020 will mark a turning point for humanity with its successive lockdowns and the accelerated adoption of digital technology but above all, an almost total shutdown of the traditional global economy. Whereas NFTs and crypto, on the other hand, will end up running at full speed.

In other news, less good, Axie becomes the last project on the Loom sidechain, as they revealed they would stop their support for NFTs games in order to focus on the medical sector. Never fear, Sky Mavis starts working on its own sidechain: Ronin.

axie infinity ronin

Then it all starts to come one after another for Sky Mavis. In June, they join Ubisoft’s incubation program (entrepreneur labs) and in July, Ronin’s testnet was launched. Like all dApps on Ethereum, Axie Infinity suffered the full brunt of high transaction fees due to the raging DeFi Summer.

But it was also the time to think about different cases for the application of decentralized finance adapted into their game, in particular with the smooth love potion ($SLP) and a governance token, the $AXS.

axie infinity tokenomics

At that time, when Binance announced that it had listed the $SLP token, the most important was not the peak at $0.20 before going down to $0.02 but rather the entry of a utility token relating to an NFT project on one of the largest exchanges in the crypto sector.

The consequences of this entry on the platform would not only mark a turning point for Sky Mavis, but also change the lives of thousands of people around the world.

A crypto-nation ?

The founders of Axie like to compare their community to a small nation, which in many ways seems to have become the case! While $AXS becomes the way for Axie Infinity crypto-citizens to vote for the changes they want, $SLP is becomes the currency of this new nation.

If the inhabitants of Lunacia are the Axies, it is nevertheless the humans who control them who will be able to give the direction that Lunacia will take. But while it’s interesting to know how the system that runs a crypto community works, at the moment it’s still far too early to be able to precisely define what government system is set up.

Pending the establishment of this political system, it is an economic system that has been in place since last year: the Scholarships.

axie infinity scholarships

It is worth contextualizing a little before going into details: 60% of Axie Infinity players come from the Philippines, it is important to put into perspective the average salary of a citizen in this country.

If a player has 3 Axies, he only has to complete the daily quests to earn 50 $SLP per day. At the current price of Smooth Love Potions at 0.27 USD, that’s about 4,927 USD per year, and this is only for daily quests. More rewards can be earned through Arena (depending on your ranking) or Adventures (with a limit of 100 $SLP per day). We let you do the math…

But not all players can afford to buy three Axies to start playing, and this is where scholarships give newcomers a chance. Players with a certain number of Axies and fulfilling certain conditions were able to lend access to their game account so that other players could enjoy not only the game but also the rewards in $SLP.

Axie Infinity adventure mode

It is important to know that each Scholarship operates differently but overall, after signing a contract, Axie’s lender will receive a percentage of the $SLP obtained by his students and provide them with his expert advice to win more games.

The percentage conditions are very variable but it is rare for a student to receive less than 50% of the $SLP won, so choosing his right scholarship begins with due diligence!

A virtuous economic circle, therefore, where early adopters can lend part of their resource to generate more but above all share it.

Conclusion: still a lot to build

Axie’s great strength lies on one hand in its community but also in this economic model that has literally saved lives during this period of global pandemic.

Indeed, by reading the first newsletter of blackpool.finance on the subject, many testimonies are given on the change that Axie Infinity has been able to bring in people’s lives. Distribution of food, payment for education or medical expenses.. these are just a few examples of the change Axie Infinity has been able to bring to people’s lives.

Axie Infinity mobile game

But this dependence is not without drawbacks. Indeed, in the event of a server failure, a whole population is left without pay. This has been directly reflected in the price of $SLP and $AXS, in the same way that a traditional stock market falls when a country is at a standstill.

In addition, because of the high demand for scholarships that come from all over the world, entering the world of Axie is becoming more and more difficult. But soon the barriers should soon be lowered because a free to play game will make its appearance to meet the growing arrival of new players.

The rise of the game has made it possible to explore avenues that were previously impossible to imagine a few years ago. There are still many steps to take for the game before it can fully proclaim itself a “crypto nation” but at the moment, it is Axie Infinity that comes closest to this definition.

Who could have believed that little monsters coated with love would change the lives of so many humans in such a short time? However, this is the case and it would seem that adoption is not about to stop any time soon!

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