Axie Infinity presents an endless capacity for people to earn through NFT and Blockchain-powered games. The popularity of the game, which can be played on mobile and desktop, is often connected to the financial wrecks the Global Pandemic left in its wake. Today, many Venezuelans, Filipinos, Brazilians, Vietnamese, and many people from other South American and Asian communities, play the Pokemon-styled video game with hopes to earn a sustainable living by trading the game’s token SLP in crypto marketplaces.
The adoption by third world countries is expected; even though Axie Infinity is a metaverse—NFT—Blockchain-based video game, the bottom line is that people from third world countries have a chance to earn monetary rewards. The game’s mass adoption leverages three principles:
1. A player does not need a high-powered computer or a graphics card to play. Many players even play on their phones.
2. Players can earn monies that can be spent in the real world from playing.
3. Axie Infinity has a large community, and there is constant support for players to buy their Axies. Community supports exist in Discord and Telegram groups, where investors loan Axies to players for a percentage of whatever the players earn.
Playing the Game: Scholarships
Axie Infinity’s ease of entry and simplicity of gameplay has attracted many users, with the developers, Vietnam-based company Sky Mavis, announcing over 2.8 million daily players on the game’s website. While players in droves can be seen in a picture on the French news website, Fan24, playing the game on their mobile phones, its entry fee is monumental.
To play, a player must purchase a set of three Axies. An Axie in today’s market costs anywhere from $250 to $500 – for the Axies with low genetic pools. A player who wants a better Axie can pay $1,000 to $3,000. Yet, some Axies run into hundreds of thousands of dollars, with the highest Axie sold for $820,000.
The price of three Axies climb to over a thousand US dollars—a steep amount for some players in the United States, let alone players in countries like Venezuela. To solve the problem, many companies within and outside Venezuela loan Axies to players for a cut in the players’ earnings. The sharing formula is entirely dependent on the lending company.
Most companies or individuals that loan Axies and train players often have a long waiting list of people ready to join the ecosystem and make money. Black Esports, a Venezuelan-based startup, takes 30% to 40% of players’ earnings for each Axie loaned to players. The company selects players through a scholarship system.
Binance, through its Twitter Binance Spanish account, announced on September 6, 2021, that it would give Axie users scholarships— in a bid to enhance gameplay and NFT adoption in developing countries. The crypto exchange does not plan to collect a dime for its scholarship—which is what an actual scholarship structure should implement.
Axie Infinity has become a secondary and even primary source of income for many people in South American countries, especially Venezuela and the Philippines. The Philippines are the largest adopters of Axie Infinity, followed by Venezuela, the United States, and Indonesia, CoinDesk reports.
The ability to earn even a few hundred dollars every month from playing two hours per day of an NFT game on a mobile phone is an appealing proposition for people from developing countries. Take Venezuela, a country whose currency has suffered dire inflation parallel with the severe economic downturn; people have to work inhumane shifts to earn little. A United States dollar is worth 443,152.82 Venezuelan Boliver. How can a person in such a country afford a thousand dollars for an Axie? — thankfully, the scholarships are there to help. On the bright side, earning $150 to $300 every month is mouth-watering for some people.
Axie Infinity Gameplay
Axies are fierce pets in the Axie Infinity metaverse that can battle, treasure hunt, and build kingdoms. The decentralized Blockchain model allows players to own a part of the game. Earning potentials with the Axie Infinity world includes:
In the PvP battles, the Axies are pitted against one another to battle for superiority. Be wary. Your Axie’s genetics will determine its capacity to battle and win other Axies or the Chimera.
Ignite your adventurous spirit by battling the enemy, Chimera. Do not be swayed; you get rare treasures like Small Love Potions, SLP—one of Axie Infinity’s tokens for every battle you win. You can always cash in on your SLP tokens, use them for in-game purchases, or sell them on crypto exchanges.
Show your skill, strength, and cunning by battling in open tournaments. Earn real money prizes for real-world use when you advance in tournaments.
Match two-parent Axies to give an offspring Axie with the combined genetic makeup of the breeding parents. You can make as many Axie babies as you wish—as long as you have enough Small Love Potions for breeding.
In the Axie Infinity metaverse, players can become land barons, buy land, farm for unique resources and tokens, and attack dungeons. The least priced land in the Axie Infinity metaverse is $11,752. Land parcels are tokenized, and each plot of land—also known as Lunacia, comprises an 8 by 8 grid. Players can put their Axies and other items on their lands and fight off Chimeras. For most players in third-world countries, owning a Lunacia is almost out of reach.
Axie Infinity Coin
Axie Infinity has two native tokens, the Axie Infinity Shards, AXS, and Small Love Potion, SLP, which are the in-game rewards players earn from playing the game.
Axie Infinity is decentralized finance, and AXS, its governance token, is traded on exchanges like Coinbase. As a governance token, AXS holders have a say in the game’s direction. As of writing, an AXS is $46.46.
As of writing, one SLP, Small Love Potion, is $0.01674—around 1.6 cents. With the current value of an SLP, a player that wants to earn $200 in a month must make 11,947 SLPs.
The Ease of Making Money in Axie Infinity
Axie Infinity is decentralized finance and a game. The tokens, especially the SLP, are structured as rewards to dedicated players; however, earning a sustainable income from playing the game is not feasible, especially for players from developed countries like the United States.
However, players from countries like Venezuela and the Philippines may be able to live off the income from Axie Infinity. For example, the Venezuelan minimum wage is only $28—a far cry from the minimum wages of many other South American countries. The average Axie Infinity player can earn $150 to $250 per month, depending on the number of staked Axies. Wins in adventure mode can make a player 2 to 20 SLPs, and Arena mode wins reward 2 to 18 SLPs. Players who understand the game can easily win more battles, earn more SLP and sell on DEXs like Uniswap.
Concerns about Axie Infinity
In late March, DeFiYield REKT, through its database resource, announced that Axie Blockchain had been compromised and more than $600 million were stolen by hackers.
The US Treasury Department revealed that Lazarus, a North Korean-backed group responsible for some major hacks in the United States and Europe, was behind the hack. If the company’s traded volume in its in-house marketplace is over $3.6 billion, a $600 million hole raises concerns.
The hack is recent; however, many financial analysts have raised concerns about Axie’s business model, calling it a hype train that will end disastrously for investors and players.
According to Will Gottsegen, a CoinDesk media reporter, the problem with the Axie network is that the game isn’t built on the secure Ethereum Blockchain. ‘Axie Infinity uses a custom-built sidechain called Ronin – essentially an Ethereum spin-off meant to reduce the congestion on the main chain,’ Gottsegen explains. To play the game, you have to port your cryptocurrency from the main chain to Ronin through the bridge—a unique program popular with NFT games like Axie and Defi Kingdoms.
Blockchain structures are almost foolproof, but moving funds from one chain to another through the bridge leaves security loopholes. Sky Mavis’ reaction to the hack was unimpressive, as the company did not even know about the security bridge until after six days—or maybe they knew and decided to take their time on an official announcement.
The hack revealed the dangers of play-to-earn games: you can lose everything in an instant. And it’s not just the hack. A new NFT game in the market can become the latest trend and Axie players may migrate. As of writing, players cannot withdraw their earnings from the game, although Sky Mavis claims it plans to pay players what they lost.
Another concern with Axie Infinity is the play-to-earn model: When a play-to-earn game is launched, players are mostly interested in one thing, money. When everyone tries to take from a marketplace, its existence will depend on more people joining the marketplace, making the NFT market place look like a multi-level marketing structure. Sky Mavis countered this concern in its whitepaper, claiming that with many in-game valuables like land, updates to game stages, and community interactions, many players remain on Axie because the metaverse is fun. The company is believable because Axie is the most played NFT game, and the United States ranks third on the list of countries with the most Axie players.
In the absence of real-life and valuable utilities, the Axie world is controlled by demand and supply. A strict demand-supply-based market can suffer epileptic price movements stemming from consumer behavior. The pattern is seen in the value of the SLP: On April 26, 2021, the price of an SLP skyrocketed from 3.5 cents to 36.5 cents. In 2022, the price plunged to around a cent but stabilized at 1.6 cents. Such price movements can bankrupt investors. Sky Mavis, in response to protecting the value of the SLP and AXS took some measures:
– Reduced in-game rewards
– Establishment of a community treasury. The treasury takes 4.5% of all marketplace transactions.
– Advertisements and offline events, with all proceeds going back to the game and the players.
The Axie Infinity community is robust, with discord groups, telegram groups, and the support of the largest crypto exchange. The in-game rewards are enough to draw in players from developing countries, but the rewards are also often minuscule. An SLP is worth around 1.6 cents—and might face a near-future dip because many investors might dump the crypto once they have access to their funds. In-game tasks give players anywhere from 2 to 20 SLPs. Earning substantial money, like $200 a month, will require skilled gameplay and time.
Ultimately, unless you play Axie Infinity for the love of the game or as a side hustle, the economy might not be sustainable. For people in developing countries like Venezuela, the game remains a potent job source for the many people whose governments have made life unlivable.