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Axie Infinity
Developer(s)	Sky Mavis
Engine	Unity
Platform(s)	Windows Android macOS iOS
Release	March 2018
Genre(s)	NFT Online game Strategy game
Mode(s)	Single player, PvP

Axie Infinity is a non-fungible token-based online video game developed by Vietnamese studio Sky Mavis, known for its in-game economy which uses Ethereum-based cryptocurrencies.

Players of Axie Infinity collect and mint NFTs which represent axolotl-inspired digital pets known as Axies. These creatures can be bred and battled with each other within the game. Sky Mavis charges a 4.25% fee to players when they trade Axies on its marketplace.

In September 2021, most Axie Infinity players were from the Philippines.

Axie Infinity is built on the Ronin Network, an Ethereum-linked sidechain developed by Sky Mavis. The game utilizes a dual token design featuring a governance token and an utility token.

The ecosystem's governance token is "Axie Infinity Shards/Token," or AXS for short. In December 2022, Axie Infinity kicked off its Contributors Program, which marks the beginning of its governance initiative. As of December 2022, the market cap of AXS was ~$700M, and roughly $~300M of this is staked with the protocol.

Axie Infinity also features a utility token called "Smooth Love Potion," or SLP for short.  SLP's main utility has historically been to breed new Axies, but as of August 2022, SLP can also be used to craft runes and charms. As of December 2022, the market cap of SLP was ~$90M.

Gameplay

According to the company's website, Axie Infinity is a competitive game with an "idle battle" system derived from games like Final Fantasy Tactics and Idle Heroes. The game's setting is filled with creatures called Axies that players can collect as pets. Players aim to battle, breed, collect, raise, and build kingdoms for their Axies. The game has an in-game economy where players can buy, sell, and trade resources they earn in the game.

Sky Mavis marketed the game with a "play-to-earn" model (also called "pay-to-play-to-earn" model) where after participants pay the starting costs, they can earn an Ethereum-based in-game cryptocurrency by playing. Axie Infinity allows users to cash-out their tokens every fourteen days. This model has been described as a form of gambling, and one with an unstable market that is overly reliant on the inflow of new players.

In February 2020, Sky Mavis estimated that a new player would need to spend around US$400 to meet this starting requirement. By August 2020, the cheapest Axie cost approximately US$307, although reports as of March 2022 suggest the floor price of an Axie has dipped to around US$20.

In the Philippines, the prohibitive cost of entry led to both individuals and gaming guilds renting out assets to allow new players meet the minimum requirements. These new players, known as "scholars", are often required to meet a quota of in-game earning to continue using the rented assets, and must pay the owners a commission. These commissions vary greatly but can be as high as 75%.

As of June 2021, some people in the Philippines had begun to treat the game as their main source of income, although earning rates from playing Axie Infinity fell below the national minimum wage by September 2021. The Philippine Department of Finance also clarified that income from playing Axie Infinity is taxable, and suggested that the SEC and BSP may classify its cryptocurrency as a currency or a security.

Players of Axie Infinity can also purchase virtual land and other in-game assets as NFTs. The record sale of a plot of virtual land was priced at US$2.3 million, as of 25 November 2021. Gameplay related to purchased virtual land was intended to be introduced by 2020, but this has been pushed back twice as of April 2022. The delays have prompted complaints from users coinciding with a sharp decline in the profitability of the in-game economy.

Development and history

Development of Axie Infinity commenced in 2017, led by its co-founder and CEO, Nguyen Thanh Trung, alongside Tu Doan, Aleksander Larsen, Jeffrey Zirlin, and Andy Ho. Nguyen had previously spent money on the game CryptoKitties before he began work on his own blockchain-based game, combining elements of CryptoKitties with gameplay from the Pokémon series or Neopets.

In October 2018, the development team released Axie Infinity's first battle system. Development of the real-time card battle system and application commenced in March 2019, and an alpha was released in December 2019.

Sky Mavis launched Ronin wallet in February 2021, which in addition to speeding up transactions and eliminating expensive gas fees for gamers offers the opportunity to play Axie Infinity or any other dApp that run on the Ronin sidechain.

The value of the game's associated token, Smooth Love Potion (SLP) (formerly known as Small Love Potion by the community), crashed in February 2022 amid a wider NFT and cryptocurrency crash, losing over 99% of its peak value. Sky Mavis attempted to stabilize the price by introducing new features to the game, but these attempts were ineffective. The low exchange value of SLP has caused a massive exodus of players, leaving guild leaders without their cheap third-world labor force to grind on their behalf. Sky Mavis removed references to "play-to-earn" on its websites and marketing as its tokens plummeted in value.

On 23 March 2022, hackers compromised the Ronin Network, stealing approximately US$620 million in Ether and USDC. A total of 173,600 Ether and 25.5 million USDC tokens were stolen in two transactions. It took the company six days to notice the hack. The hack currently sits as the largest-ever breach in the cryptocurrency sector by dollar value. It further damaged the value of SLP. On 8 April 2022, Sky Mavis said it expected it would be able to recover some of the funds, but it would take several years. The company raised additional venture capital and reimbursed all users affected in the hack. On 14 April 2022, the FBI issued a statement that the Lazarus Group and APT38, which are North Korean state-sponsored hacker groups, were responsible for the theft. Accordingly, the US Treasury has sanctioned the cryptocurrency address. Some of the cryptocurrency has been laundered through a cryptocurrency tumbler known as "Tornado Cash".

Axie Infinity Origin

On April 7, 2022, a new edition of Axie Infinity was released called "Axie Infinity Origin". This was version 3 of the game which aimed to improve upon the previous 2 iterations' graphics and gameplay. The new additions in the game also included a number of changes such as the ability to improve Axies' by adding runes and charms to them. In the previous versions Axies' were static, and were unable to be changed. In Origins, each Axie has 6 slots to add charms to which increase the Axies' ability to battle. There's also 1 slot to add a rune which typically offers one substantial upgrade to the Axie's abilities. Other changes included a deduction in the ability for a player to earn SLP as well as a new platform that will allow for future mini-games to be added to the Ronin network using the suite of services and resources available through Sky Mavis.

Much of the gameplay was changed from version 2 in regards to playability and SLP earning (The gaming token which can be bought and sold for government backed currency) which is gained when a player wins a battle against another player. Prior to the release of Origins, SLP earnings were fairly robust Season 2. In Origin, the SLP token gained from winning can only be gained at a certain level, and a player must own and have equipped at least one rune or charm purchased from the Marketplace. This addition has reduced the issuance of SLP tokens and has simultaneously increased the burn of tokens as they are now used to purchase runes and charms, which in-turn grant players a small advantage over competing players. According to Sky Mavis, the change in SLP issuance vs burn is an attempt to change the token from an inflationary cryptocurrency to a deflationary one.

The graphics of Origins were enhanced and the gameplay changed to reflect a different game. In version 2, a player would choose the cards they would play in advance per round and then execute the play. Whatever cards are left over would spill over into subsequent rounds. In origins a player would choose the card they wish to play and it will be immediately used. No cards would be left over for the next round, and the player would get a new shuffle once the round starts.

Reception has been good overall for the new edition of Axie Infinity, with reviewers stating that the much needed upgraded was "engaging". Critics argue that the dramatically reduced price of the SLP token, which was a major factor of the game's loss of players in 2021 is a sign that the game will never recover its former glory.   

See also

• Blockchain
• Blockchain game
• Decentralized application
• Non-fungible token

References

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Further reading

• D'Anastasio, Cecilia; Volpicelli, Gian M. (30 November 2021). "The Escapist Fantasy of NFT Games Is Capitalism". Wired. Retrieved 2 December 2021.

• Blockchain games
• Ethereum
• Video games developed in Vietnam
• Virtual pet video games
• Cryptocurrency theft