Axie Infinity cuts 'breeding fees' while AXS price struggles
- Team behind Axie Infinity is concerned about an "imbalance" in token issuance on its platform, takes measures to trigger growth.
- Crypto finance group observes that gaming incentive economics are slowly adjusting to prevent large-scale selling from mercenary capital pools.
- To tackle imbalance, Axie Infinity plans to slash 'breeding fees' down to 1 AXS and increase the cost of SLP.
Faced by the challenge of stunted growth in its NFT gaming ecosystem, Axie Infinity has decided to cut the cost of breeding fees in half. Many observers, however, are concerned over changing gaming incentives in play-to-earn games.
Axie Infinity tackles dropping SLP price and stunted growth by slashing breeding fees
The NFT-based online play-to-earn game Axie Infinity uses Ethereum-based cryptocurrencies Axie Infinity (AXS) and Smooth Love Potion (SLP). The game is currently a leader in the NFT gaming universe, and there are currently over 1.5 million active players worldwide.
In-game earnings are distributed in the form of AXS and SLP, tokens that can be bought, sold and traded.
The platform has suffered stunted growth with the plunging SLP price. Axie Infinity team recently announced that it is updating its “breeding fees” and has concerns over an “imbalance” in token issuance.
To fix the recognized issue, Axie Infinity has identified the need to increase SLP price in accordance with a new fee breakdown and reduced breeding fees by 50%. The announcement included concerns on the volatility of AXS and SLP. It states that large fluctuations in the breeding fees have taken away from SLP’s utility within the game’s economy.
Amber Group, a leading crypto finance group has identified the changing trend in gaming economies.
But, outside of @AxieInfinity, will games over time be receptive towards this model? Taking cues from DeFi, we all remember when Curve started becoming hostile towards Yearn last year.
— Amber Group (@ambergroup_io) September 23, 2021
While revisions in fee structure are fairly common in crypto gaming, the community has not received the news of the update well.
Andrew Bailey, assistant professor at Yale-NUS College, labeled Axie Infinity’s updated gaming economics as “ponzimonics.”
"Ensuring long-term sustainability for the economy will rely on a combination of player growth, new sources of demand... and external organizations subsidizing play-to-earn..."
— Andrew M. Bailey (@resistancemoney) September 23, 2021
At least they're honest about their ponzinomics!
With new updates in its ecosystem, AXS price is struggling to recover. Pseudonymous cryptocurrency analyst and trader @CerbulBTC has predicted a correction in AXS price.
The analyst has noted that AXS bounced 30% from its support, and there is a drop in trade volume. Axie Infinity token is holding well against the overall performance of altcoins in the cryptocurrency market.
$AXS
— Cerbul (@CerbulBTC) September 22, 2021
Bounced 30% from the support.
Volume also dropped, so I'm waiting for a correction.
The whole #crypto market structure doesn't look so optimistic on short-term, but #AxieInfinity is still holding quite well.
Current mcap sits at $3.5B, w/ a 24hr trading volume of $1.1B. pic.twitter.com/RYXqByUkPf
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
