Introduction

Axie Infinity, a pioneering play-to-earn blockchain game, has garnered significant attention for its innovative model that allows players to earn rewards through gameplay and in-game asset ownership. The game's economic sustainability and earning potential have been central to its appeal, but understanding the return on investment (ROI) for players requires a detailed analysis of its mechanics and tokenomics. This report will cover:

• The initial costs required for players to start earning in Axie Infinity and how these have evolved over time.
• The various ways players can earn within the game, including daily rewards, staking, and speculative strategies.
• The sustainability of the game's economy and the factors influencing long-term ROI for players.

Initial Costs and Accessibility

Axie Infinity's initial costs have significantly decreased since its peak popularity, making it more accessible for new players. [1a] Players can now begin playing with a minimal investment, but the earning potential has also diminished compared to earlier periods. [1b]

• At its peak, entry costs exceeded $1,000, but now players can start with as little as $9 for three Axie NFTs. [1a]
• While this lower barrier to entry makes the game more accessible, it also reflects a reduced earning potential compared to earlier periods. [1b]

Earning Potential

Players can earn rewards through various in-game activities, including daily and weekly missions, staking, and speculative trading. [1e] [1f] [1g]

• Daily and weekly mission rewards provide consistent earnings for active players. [1e]
• Staking AXS tokens offers a steady yearly return, though this depends on the token's performance. [1f]
• Speculative strategies, such as flipping Axies or betting on AXS price appreciation, carry higher risks but can yield significant returns. [1g] [1k]

Sustainability of the Economy

Axie Infinity's economy has faced challenges related to token inflation and reliance on a constant influx of new players. [1l] Efforts to improve sustainability include adding utility to Axies and introducing new experiences, but the economy remains vulnerable to external factors like token volatility and security risks. [2a] [1m]

• The game's early economy was unsustainable, relying heavily on token inflation and a continuous influx of new players. [1l]
• Developers are working to add utility to Axies through new experiences like mini-games and land-based activities, which could help stabilize the economy. [2a]
• However, external risks, such as the $600 million hack in 2022, highlight the vulnerabilities of the game's economic model. [1m]

Conclusion

Axie Infinity offers a relatively accessible entry point for new players, with initial costs now significantly lower than during its peak. However, the earning potential has diminished, and the game's economy faces sustainability challenges due to token inflation and external risks.

• Players can start with a minimal investment of $9 for three Axie NFTs, making the game more accessible than before.
• Earning opportunities include daily rewards, staking, and speculative strategies, but these come with varying levels of risk and reduced potential compared to earlier periods.
• The game's economy is improving but remains vulnerable to external factors like token volatility and security risks.

References

[1] Charlie Butler. Axie Infinity: A Guide on How to Play and Earn. DappRadar. 24 Jul 2023. Available from: https://dappradar.com/blog/what-is-axie-infinity-and-how-does-it-work

[2] whitepaper.axieinfinity.com. Axie Economy & Long-term Sustainability. whitepaper.axieinfinity.com. 7 Sep 2023. Available from: https://whitepaper.axieinfinity.com/gameplay/axie-population-and-long-term-sustainability