![]() ![]() Video game firms, both small and large, are developing titles they hope will clean the slate of Web3 gaming. "I've never met anyone that played it just for fun," Cryptobarbarian said of Axie Infinity, "only to make money."īut Axie Infinity doesn't represent the future that many Web3 developers envision for gaming. Play-to-earn titles such as Axie Infinity prove the point they're not games as much as they are financial speculation with the veneer of a game. The fear is that crypto and NFTs will deform gaming into a side hustle, transforming its purpose from entertainment to moneymaking. The same monsters that cost hundreds of dollars last year now fetch under $10. But thanks to a combination of poor in-game economics, inflation threatening the real world's economy and a $600 million hack reportedly caused by a fake job posting, the price of Axies and the game's Smooth Love Potion cryptocurrency collapsed. Axie Infinity was a hot ticket in CryptoTown, generating over $15 million a day last August. (CNET wasn't able to verify his purchases.) A longtime crypto investor, Cryptobarbarian told me he bought $30,000 worth of Axies and loaned them out in return for 40% to 70% of the profits. The game allows Axie owners to lease out their monsters to other players, however. At its peak of popularity, bottom-tier Axies cost around $350 each, meaning playing the game once required a four-figure investment. Accessing it is free, but you need to buy a team of three Axies to play. From there, he said, Axie Infinity became purely about making money.Īxie Infinity is a browser game. "It was fun for the first few weeks, but it gets boring really fast," the 28-year-old said. Chris, who declined to give his real name and goes only by the pseudonym Cryptobarbarian, felt he could justify playing video games again - as long as it paid. Players can also breed Axies, then either sell or battle with them. ![]() A cryptocurrency called Smooth Love Potion is earned by battling these Axies. It's built on the blockchain.Īxies are the Pokemon of Axie Infinity, but they're owned as nonfungible tokens, or NFTs. That sounds like hundreds of other games, but one element distinguishes Axie Infinity. Inspired by Pokemon, it's a video game about training and battling monsters. Axie Infinity promised something different. He was once an avid gamer, playing hours of League of Legends every day, but stopped after deciding he was sinking too much time into an unproductive hobby. LE burned most of the value at the beginning, but LS burned similar amounts throughout the event.The moment Chris saw Axie Infinity, he was hooked. The temporal patterns in value burned are also distinct between the two events. Although LS had more high-usage participants, LE burned around 4.2X more value than LS, simply by having no barrier to entry. We estimated the value burned for LE using the daily axie floor price and the value of SLP and AXS burned for LS. A key economic metric is the token value burned during crafting, which can be estimated as the opportunity cost of selling on the market. So the power law constants are like the net sum of the compounding incentives and disincentives in the mechanism.Īs an economic imperative, a game developer has to capture value from in-game activity, such as crafting. Eg: Lindy walk, 80-20 rule, Pareto distribution ![]() In a power law, the more you do something, the easier it gets. Eg: The more you flip a coin, the harder it is to get all heads. In an exponential distribution, the more you do something, the harder it gets. So theoretically, if you kept the event going, the users wouldn't stop.Įven further, power laws are produced by a class of mechanisms different from those that produce exponential distributions. Interestingly, distributions with a constant < 2 have such heavy tails that they have no average. But these power laws tell us more than just that. ![]()
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