Axie Infinity (AXS) Boom: Just Hype or Gaming Revolution?
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The blockchain game Axie Infinity (AXS) has seen tremendous growth in recent months. Not only has the number of users skyrocketed, but AXS, the game’s native token, has also seen a parabolic increase for some time. Is this all just hype or are we facing a gaming revolution?
The non-fungible token (NFT) industry is still booming. In particular, the blockchain game Axie Infinity is currently breaking all records. Less than a year ago, the market capitalization of the AXS token was just $ 7 million. It now stands at nearly $ 4.1 billion.
During the same period, AXS rose from $ 0.147 to $ 72.96.
That represents an incredible price increase of almost 50,000 percent within a single year.
What is Axie Infinity anyway?
Axie Infinity is a decentralized app (dApp) that runs on the ETH blockchain. Similar to the gaming evergreen Pokémon, Axie Infinity also focuses on cute monsters that are bred, traded and sent into battles by players. In contrast to conventional classic games such as Pokémon, the little monsters (“Axies”) are immortalized as tokens – more precisely: non-fungible tokens according to the ERC-721 standard – on the ETH blockchain. As a result, they are really unique compared to “normal” gaming characters or game objects and cannot be replicated and changed at will.
In addition, players can earn tokens in the game AXS. To do this, they have to take part in PvP battles, breed Axies, farm so-called love potions, which are needed for breeding Axies, or complete other missions. It is also possible to use the AXS token in the governance of the Axie universe, to stake AXS or to use it for payments within the game.
Axie Infinity competes with Fortnite
The growth of Axie Infinity is gigantic. If it stays constant over the next few months, it is even likely that Axie Infinity will replace Fortnite as the largest Discord community in the world. For comparison: Fortnite’s Discord Channel currently has around 800,000 members, while Axie Infinity is already on over 720,087 members comes.
It's official 🌋🙌
More than 1 M daily active players!
Let's keep pushing, together 🤝$axs pic.twitter.com/1Z9ssCsFNX
— Axie Infinity (@AxieInfinity) August 6, 2021
Axie puts DeFi in the shade
For a long time, Decentralized Finance (DeFi) was the only topic that got the ETH community into euphoria. Meanwhile, however, AXS’s log revenue dwarfs all other DeFi applications.
In the last 30 days alone, the blockchain game has generated more than $ 300 million in log revenue generated. In the same period, the decentralized exchange PancakeSwap (CAKE) raised just 13.3 million US dollars. Even the ETH blockchain came in at just $ 74.9 million in the same period.
Most of the revenue from the blockchain game goes straight back to its players. Most of the capital therefore currently remains within the virtual economy and ensures that the AXS economy can continue to grow. Another part of the income flows into a community fund, which is managed by all AXS token holders. Conversely, this means that while the Axie players are making money, the community is amassing a large fortune that can be used to further develop the game.
Why is Axie Infinity only booming now?
Axie Infinity has been around for three years, and yet the hype around the game only started recently. One reason for Axie’s sudden surge in popularity is likely to be the Ronin ETH scaling solution launched in May. Ronin made it possible for the first time that normal mortals could also play Axie Infinity. As a result, the number of users, as well as the AXS course, has exploded.
Another factor that has contributed to the enormous growth is certainly the corona pandemic. As a result of the pandemic, important sources of income have collapsed, especially in developing countries. This has led to a large number of people looking for other sources of income and Axie Infinity, among others, was able to benefit from this.
Axie creates the opportunity to make money for anyone in the world with a smartphone or computer. Especially people on the Philippines, but also in other developing countries, are currently making a living playing Axie and managing their money with DeFi applications.
That could be expected in the future
The play-to-earn model of Axie Infinity and other blockchain games has the potential to help 180 billion heavy gaming world to change fundamentally. It is even conceivable that sooner or later play to earn will supplant the pay-to-play gaming model. Mainly due to the steadily growing layer 2 scaling environment and ETH 2.0, it is likely that we will see many more blockchain games in the coming months and years that could fundamentally change the crypto sector.
The advent of blockchain gaming, metaverse, and the associated virtual economies has only just begun. In particular, their combination with decentralized finance could be the next big catalyst for another massive bullrun, from which residents of poorer countries and regions in particular could benefit.
