Axie Infinity ‘Play to Earn’ Future in Doubt, Value of Earned Currency ‘Smooth Love Potion’ Collapses from $0.35 to $0.01 Over 6 Months

  • Play to Earn monster battling game Axie Infinity’s currency plunges 97% in 6 months, hurting player incomes drastically.
  • Axie’s governance token (AXS) also declined 70% in value during the same time period.
  • Game’s land prices remain high at a foor price of $8,000

While Axie Infinity has been the darling of the ‘play to earn’ movement and helped bring it to the mainstream, the future of the game’s play to earn economics are in doubt. The value of the in-game currency, Smooth Love Potion (SLP), has collapsed from $0.35 on July 12, 2021 to about $0.01 today for a total loss of 97%. While the core concept of Axie Infinity remains intact, playing the game to earn SLP is no longer a profitable proposition for most. Players with decent Axies can typically earn about 100 SLP per day after using up all of their energy, which equates to a little over $1 at today’s prices. Energy in Axie if a stamina currency which limits how many SLP earning activities players can engage in daily and only being able to make $1 doesn’t sound like a profitable proposition for most.

Besides SLP, the value of Axies themselves (the Pokemon-like creatures in Axie Infinity which are required to play), have also collapsed in value with the cheapest Axies trading for less than $30 as of early February 2022, down from about $200 in July, 2021. Keep in mind, this is the price of the CHEAPEST Axies available. To earn 100 SLP daily, more powerful Axies are required. The price of Axies collapsing does offset some of decline in value for SLP for anyone considering investing in the game today, but anyone who purchased Axies at inflated prices in the past based on the price of SLP at that time is likely facing deep losses.

Coin Market Cap SLP Price
A decline of 97% in the value of SLP. Source: Coinmarketcap

While the price of SLP is at a near an all time low, Axie’s developer Sky Mavis can introduce new rules to regulate the rate in which the currency is earned, which in theory can stabilize prices. Still, the dreams of many Axie players who bought their Axies at much higher prices have likely been dashed. Despite these declines, the total money (USD) involved in the digital economy of Axie Infinity is massive. Daily volume of SLP is regularly above $50 million and sometimes spikes much higher ($265M on February 3, 2022). It may be too early to write off Axie Infinity though, as the game’s developers are constantly introducing new features and the game’s playerbase remains large (360,000 concurrent according to Coin Telegraph).

A decline of 70% in the value of AXS. Source: Coinmarketcap

Axie Infinity’s governance token (AXS) hasn’t been spared from the recent carnage. Its price is down 70% from a peak of $160 on November 11, 2021 to $48 on February 3, 2022. Despite the decline, the fully diluted market cap of the AXS currently sits at $13 billion with daily volumes of over $200m. Value of in-game land in Axie is down as well, with the cheapest plots available for ~$8,000. (down from $12,500 in July). 

It’s worth mentioning that the unit economics for Axie Infinity never made sense for those in developed countries. At least in terms of actually playing the game. Only 7% of the game’s active playerbase is in the United States with over 40% in the Philippines and the next most in Venezuela.

Not sure what Axie Infinity is? Check out the game’s official trailer below:

Further Reading: Axie Marketplace (To view floor prices), Land Marketplace

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