Axie Infinity is still among the most popular games on the market. But the game’s tokenomics is facing problems with an oversupply of Smooth Love Potion (SLP), multi-accounting and too many Axies.
On the positive side, joining the game is now cheaper, with an Axie floor around $30. SLP is now down to $0.009, becoming a sub-penny asset and breaking away with all expectations of recovery.
Why Axie Infinity Tokenomics Matter
The importance of Axie Infinity lies in using its model across other P2E games. Thus, the problem of multi-accounting, bot play and oversupply can transfer to other games.
Currently, most activity on the game is players against the computer, opening up the opportunity for bots to play randomly, accrue SLP and further drive down prices. A recent user proposal envisions a future for Axie where only human players with skills are incentivized. This would shrink the Axie economy, but also shift it to more valuable gameplay and loyal users.
The current model has turned Axie NFT characters into a utility asset. Formerly, Axie characters commanded value close to blue-chip NFTs, but the floor price continued to drop and rarity was not as important.
RON Token Launch Failed to Jump-Start Axie Tokenomics
The recent RON token launch and early payouts could not overturn the recent price weakness for both AXS and SLP. RON is the native token of the Ronin network, which is used for Axie gameplay to avoid high Ethereum fees.
The oversupply of tokens could not be mopped up by RON liquidity rewards. Bearish market conditions also hurt sentiment for AXS and SLP, as well as the realization that RON rewards remained relatively low.
RON is in price discovery mode, with its trading still getting established. The expectation for RON is to continue sliding to a lower valuation and then see adoption pick up.
Can AXS Bounce to Previous Highs
AXS established relative stability at $50.49, as it abandoned the previous stability tier around $100. AXS still has a bearish attitude while the entire crypto market stagnated once again as Bitcoin (BTC) froze around $37,000.