- Axie Infinity, the most playable blockchain game, once again changed the breeding fee.
- AXS token has been skyrocketing while SLP was lagging behind.
- The new breeding model doubles the necessary SLP and reduces AXS fee from two to one.
The exponential growth of the Axie Infinity community over the course of the last few years has been phenomenal and the past few months of 2021 are no exception because more and more people are boarding the blazing train of this play-to-earn game.
Veteran players have already grown accustomed to the highs and lows that come with the drastic changes in the supply and demand of AXS and SLP and they have already reaped the return of their investments. But there are many newbies out there who are pressing the panic button because they are worried, perplexed, and frustrated due to the volatile nature of the crypto economy in general.
To sum up the key economic concepts of Axie Infinity to the uninitiated, SLP can only be accumulated through the efforts and skills of players because they are granted as rewards every time they play and emerge victoriously.
With that said, an Axie can only be created by burning SLP because it is tangible proof that an actual human player played the game for a set amount of time. And so it follows that when new players join the Axie Infinity community, there have to be more Axies than there are players because each team is composed of three Axies.
The Law of Supply and Demand
Therefore it goes without saying that the sudden changes in supply and demand in the Axie marketplace force developers to think of new and innovative ways for the sustainable balance of the economy. Aside from the growth of individual players, this requires new ways to generate demand for Axies as well as the help of external organizations and investors who can shoulder end-of-season rewards and various tournaments that will subsidize the play-to-earn aspect for players.
Sky Mavis also released the most recent update that changed the Axie breeding fee: the AXS cost per breeding session has been reduced from 2 AXS to 1 while the SLP cost per breed has been increased and is highlighted on the chart below.
Perfectly Balanced as All Things Should Be
Is still sustainable in the long run?
First of all, users have to realize that the Axie developers are working hard to strike the perfect balance between rewarding the efforts of players and at the same time supporting a long-term plan aimed at sustainable community growth. This is due to the fact that Axie’s economic and community growth is cyclical in nature therefore developers need to take into consideration the current and future demand for Axies when making adjustments to balance out the economy.
With the launch of the Ronin Dex and Battles V2, the projected growth for 2022 indicates that approximately tens of millions of Axies are needed for the future onboarding rush and predicted heavy influx of seasoned vets and newbies alike. If there is not enough SLP to meet this inevitable spike in demand, the low supply will cause its price to surge very high initially and then crash back down when the economy normalizes again and this causes unrealistic expectations for both managers and players.
This unpredictable volatility of AXS and SLP is the reason why the developers decided to release these timely updates and changes in breeding fees to assuage the fear, uncertainty, and doubt of players who are easily rattled and unnerved by the slow return of their initial investments. For now, the dedicated team from Sky Mavis is implementing these changes manually but in due time, they want to outsource the painstaking and complicated task of managing their economy to outside consultants, expert members of the Axie Infinity community as well as intelligent, computing machines.
This can help them analyze tons of data and crunch some numbers to provide results, insights, and solutions in a short amount of time.