• How Axie Infinity Became the Second-Highest Fee Revenue Generator

  • Axie Infinity has been on a roll recently. The play-to-earn platform has emerged as the face of a new crypto-gaming integration with enormous potential.

    With the exception of Ethereum, Axie Infinity has surpassed 1 million daily active users and is generating more revenue than any other protocol or platform. Yes, Axie Infinity earns more fees than major platforms like OpenSea, Uniswap, Bitcoin, and the Binance Smart Chain.

    Axie Infinity is at the top of the charts.

    Connor Dempsey of Coinbase Ventures lays out the short and sweet of the story quite well in a series of tweets. Every Axie transaction, as Dempsey correctly points out, collects a priced-in fee – either in $SLP or $AXS.

    At the time of writing, Axies had generated over $17MM in sales volume in the previous 24 hours, placing them first among NFTs. On the sales volume chart, the next closest NFT project is Bored Ape Yacht Club, which is just under $9MM.

    You read that correctly: Axies has nearly doubled the next closest comparable NFT project today. Axies, of course, lead the 30-day and all-time charts for NFT sales volume, with the platform surpassing $1.7 billion in transactions and approaching 1.5 million owners.

    When it comes to long-term blockchain fee revenue, Axies shines even brighter. Any long-term time horizon from the 90-day chart and longer, according to Token Terminal, reflects a fee generation from Axies that exceeds Ethereum. According to Dempsey’s tweet thread, the treasury pool from Axie fees has grown to nearly $600MM.

    Is the Sky… Infinity?

    Dempsey’s tweet thread leads to a new Coinbase blog post this week about Axie Infinity, the associated gaming guild Yield Guild Games, and the play-to-earn model more broadly.

    The high demand for Axies in Axie Infinity has resulted in Axies costing an average of $300 this month, with a minimum of three Axies required to play the game. Revenues nearly doubled in August compared to July. What caused this to happen?

    It began with an outbreak in the Philippines last year. It has grown so much in the country that government finance officials have stated again and again that profits from play-to-earn titles must be reported as income tax. Other developing and emerging countries, particularly those hard hit by the COVID-19 pandemic (and where local currencies may have weakened), have discovered a living wage modeled by Axie Infinity.

    The most serious criticism leveled at Axie concerns its long-term viability; will the market’s consistently rising entry costs create insurmountable barriers to entry? Yield Guild Games enters the picture, lending out Axies in exchange for a small fee. Yield Guild Games even collaborated with the exchange FTX to sponsor over 100 players from developing countries. The surrounding economy to support Axie Infinity is taking shape right in front of our eyes.

    Axie Infinity is paving the way for the play-to-earn model, and it is having a significant impact on people’s lives.

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