Author | Owen Fernau

Axie Infinity is a blockchain-based game that has become popular among cryptocurrency users. It allows players to earn real money, and a lot of it, exceeding monthly salaries in many of the world's poorest countries.

It's a massive game, with 1.5 million daily users according to its most recent development update. That’s more than BTC’s all-time high of 1.36 million active wallets set on April 15, according to data provider Glassnode. Axie grabbed a lot of headlines earlier this year for its meteoric growth.

But Axie Infinity suddenly ran into a crisis.One of its internal tokens, Smooth Love Potion (SLP), a key tool of the gaming token group, has been suffering from extreme volatility, even by cryptocurrency standards.picture

Axie Infinity's Smooth Love Potion has lost three-quarters of its value since July.

For Axie Infinity players who earn SLP Tokens in-game and sell them to pay real-world bills, this torque is wreaking havoc. It raises big questions about the potential of games and NFTs to truly create a sustainable economy, a rising hope this year as the DeFi community — and Facebook’s Mark Zuckerberg — prepare for the Metaverse.

Axie Infinity revolves around three-on-three battles between so-called Axies, or NFTs. People can breed Axies by spending a combination of Axie Infinity's Smooth Love Potion (SLP) and Axie Infinity Shards (AXS), or buy them. Axies are often very expensive for people in developing countries, which leads to"manager"picture"scholar"。

This model has produced a very large value-according to the data of Token Terminal,The game generated $244 million in revenue over the past 30 days, and even topped Ethereum at one point in the last month.Now, with SLP out of reach, an intermediary has emerged in this mechanism - the manager and the player share the winnings in the form of SLP.

Players are freaking out as earnings drop. User myomie said in the Axie Infinity Discord:"Omg please hurry up and control the price of SLP, we need to upgrade it" 。"I wish the devs would do something about the price of SLP,"said another.

Administrators are also reportedly in trouble."I've lost 50 scholars this week due to the SLP price drop."Theblender101 said in the discussion forum of Axie Infinity. Others are considering whether to sell their Axie NFTs because SLP rewards are not adequate.

Even so, some managers are still battling the turmoil."I'm not worried at all,"In fact,

In fact,The game's current mechanics may be responsible for the low SLP prices-- Players continue to get Tokens through battles, but the only way for SLP to decrease is when people use Tokens to breed Axie NFT (SLP is actually removed from circulation when it is multiplied, called burning).

picture

Axie Infinity COO Aleksander Larsen referred to The Defiant his statement on Twitter when asked about SLP’s recent price action.

"I think SLP is a commodity,"Larsen said in his thread."Its price will fluctuate, but what we really need is deep liquidity to ensure a certain degree of price stability." 

Ronin DEX, a decentralized exchange, will help enable this depth of liquidity, Larsen said. The DEX will be built on Axie Infinity’s Ronin sidechain — a blockchain that runs in parallel to Ethereum but with much lower fees.

picture

The low fees of the Ronin sidechain are critical to the success of Axie.But is it ready for more users? "Not yet," Larsen said."In its current state, can the game handle another massive growth spike that usually follows high SLP prices?"Larsen tweeted."Can Ronin do it?"

Some users are excited."Axie Infinity is basically ready to onboard the next 10-15 million users,"Withers said, adding that SLPs will be needed to propagate the next wave of Axie NFTs.

More help may come from an upcoming"land"The game mode of Axie Infinity, which is a custom home, may provide more utility for Axie Infinity Token, such as SLP. There's also an upcoming combat system, Battles V2, which may include mechanics to support SLP prices.

At the same time, these are tough times for holders, and it's hard to blame people who play for money for selling their SLPs when they may not be worth as much in the future. For them, another burn mechanism isn't coming anytime soon.

Original link: https://thedefiant.io/axie-infinity-smooth-love-potion-volatility-drop/