The most popular Play-to-Earn game, Axie Infinity, is experiencing a resurgence. After the $600 million hack it experienced in late March, user engagement crashed. But recent improvements to the game and the ecosystem have caused its NFT sales to surge by 205%. There has also been an increase in game downloads and strong user engagement.
What Is Axie Infinity?
Axie Infinity is an Ethereum-based play-to-earn game launched in March 2018. It features a game universe filled with unique and fantastic collectable creatures. The game involves collecting, breeding, battling and building kingdoms for your “Axies”. It also features an in-game economy, allowing you to buy, sell, trade and earn resources through gameplay.
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What sets it apart from other such games is its integration with the Ethereum blockchain. This integration allows you to own the Axies you collect as virtual assets. The game rewards players who dedicate their time and effort to improving their skills.
The game is player-owned and player-driven. All art assets and data can be accessed by players to create their own experiences within the game. Axie Infinity is ranked as the number one Ethereum based game by active users.
Land Staking in Axie Infinity
Land staking is the next step in Axie Infinity’s ever-expanding universe. Ever since land plots were made available within the game, they were meant to serve as an opportunity to create more experiences and rewards. This new initiative allows landowners to stake their land and earn rewards in the form of the Axie Infinity token, AXS.
This is only the beginning of more features to come. In the future, Axie intends to add more gameplay-centric requirements to claim rewards. This leads to more engagement between the users and the game.
As of release, Axie Infinity has allocated 337,500 AXS per month as staking rewards. There are 5 land types in the game, with each one having a different reward rate as mentioned below.
Ronin Bridge Sidechain
The Ronin bridge is an Ethereum sidechain built for the game. It enables users to transfer their assets between the game and the main Ethereum network. In late March, this sidechain experienced a devastating hack, draining it of over $600 million in tokens.
To fix the damage caused by this hack, Sky Mavis – the company behind Axie Infinity – has reimbursed its users with 117,600 ETH and 25.5 million USDC. In addition, the Ronin bridge is now back online after going through 3 rounds of audits.
The primary change to the bridge design is the update of smart contract limits. This allows validators to set daily withdrawal limits, along with a sign-off system for all withdrawals.
In tier 1, we have all withdrawals under $1 million. This requires 70% of validators to sign off. Tier 2 is for amounts greater than $1 million and requires 90% of validators to sign off. Finally, tier 3 is for amounts over $10 million. It requires 90% validator sign-off, along with a transaction fee and a 7-day holding period.
Axie Infinity Tokenomics
The game has two primary tokens, AXS and SLP:
- Axie Infinity Shards (AXS): This is the governance token used by the Axie universe. AXS is an ERC-20 token that can be earned through gameplay and staking. It allows players to vote and participate in key governance decisions. AXS enables the existence of the community treasury, which acts as the reward pool of the game. The treasury receives inflows from all Axie NFT marketplace trades along with the AXS used to breed Axies.
- Smooth Love Potion (SLP): SLP is the utility token in the Axie universe. It is used for breeding your Axies along with AXS. SLP can be earned by playing against other players in the arena.
AXS has a market cap of $1.1 billion and a max supply of 270 million tokens. It hit an all-time high of $165.37 in November 2021. Since then, it has experienced a steady decline through 2022. As of writing, AXS is trading at almost $14 per token.
Final Thoughts
Axie Infinity continues to be the most popular Ethereum game. It suffered a massive blow due to a hack to its sidechain, but it has bounced back remarkably well. The reimbursement of lost money, along with changes to the system shows the strong commitment of the Sky Mavis team to the future of Axie and its ecosystem. A return to its days of popularity seems likely with its recent developments.
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