#1 The hive mind
Ideal gas has a medium sized announcement
As you would have clearly noticed, our writing has been progressively slipping into web3 and its applications over the past few weeks. It has honestly been difficult for us to not do this so today we have decided to completely dive in. We would be doing a web3 speedrun over the next 21 days to explore all the cool developments in this space.
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On that note, let’s jump right into it! Today we will explore the world of play to earn games through Axie Infinity. We chose this as the first post because we loved how Axie’s co-founder Jeff “Jiho” Zirlin approached the whole thing:
The idea is to introduce something that’s new and a little scary [crypto] through something fun, familiar, and nostalgic. Then, adding property rights and economic freedom make it really special
What is Axie Infinity
In a nutshell, Axie Infinity is Pokemon but on the blockchain. What is axie infinity, popularity, play to earn, pareto funtier etc
“One of the main criticisms of crypto so far is that it has no real-world value or application, but Axie makes you reconsider what real-world value is. In Axie’s case, the value comes from providing meaning, income, and opportunity to the players directly”
The Play-to-Earn model
There are Free-to-Play games like Fortnite which give out the full game for free but charge for in-game items like skins and characters. These purchases are purely cosmetic and don’t give the owners any winning advantage over the other players. Then there are Pay-to-Win games like Pokemon Go. Some of these games claim to be Free-to-Play but involve purchase of in game assets that give players an advantage over the others. There are also other kinds of Free-to-Play games like Roblox which have developed a platform over which developers can create games and items. These developers can then sell these items to players in exchange for the Robux, the in-game currency.
Axie Infinity on the other hand has pioneered an entirely new model: Play-to-Earn. Traditional Free-to-Play games have the game developers selling to players while others like Roblox have developers as intermediaries. Axie Infinity however, is a player to player system.
Axie has a 100% player-owned, real money economy. Rather than selling game items or copies, the developers of the game focus on growing the player to player economy and take small fees to monetize
Here’s an oversimplified version of Axie’s economics. The game is explicitly not Free-to-Play as you need to buy 3 Axies (NFTs) to start playing. This can be done through Axie Infinity’s marketplace and once you buy them they are your own. Also these Axies are not sold by the developers, they are sold by other players themselves. While “players sell entry tickets into the universe”, the Axie protocol makes a 4.25% commission on each trade. Using these Axies, players compete in player vs player and player vs environment battles to win Smooth Love Potion (SLP) tokens. With these SLP tokens, players can breed new Axies (there are rules to how many times you can breed an Axie), speculate on the price or exchange it for fiat currency. The exchange for fiat part is the reason millions of players in developing countries are able to pay their real world bills.