Last year, Axie Infinity, a pioneer of play-to-earn gaming, became extremely popular. During the week of August 8, 2021, the game earned over $215 million at its peak. In October 2021, Axie’s creator, Sky Mavis, had even reached a $3 billion valuation after a $152 million funding round led by a16z.
However, the average cost of an Axie, total NFT sales, and daily active users have plummeted with no sign of a halt since November 2021.
Axie Infinity’s Background
First conceptualized in 2017 by Trung Nguyen, co-founder and CEO of Sky Mavis, Axie Infinity is a NFT-based monster online strategy game, where players can collect and mint NFTs as small creatures called Axies (digital pets based on axolotls), and breed and battle against each other in the game. Gamers could also purchase other in-game assets and virtual plots of land, but land gameplay is still in active development and has yet to be implemented.
Slowly being released over time, from the release of the breeding portion of the game in May 2018 to the community alpha release of the card battle portion of the game in December 2019, Axie Infinity has seen a huge amount of success in that short amount of time (as mentioned previously). Unfortunately, each project will have its high and low points, and this game is not exempt from this pattern.
Other than Axie Infinity’s token crashing (explained in more detail below), a whole series of other disastrous events have made things difficult for the Sky Mavis team and the players of the game. One such event occurred on March 23, 2022, where hackers, later identified by the FBI as the Lazarus Group and APT38 (North Korean state-sponsored hacker groups), compromised the Ronin Network (launched by Sky Mavis in February 2021, consisting of the Ronin Wallet and Ronin sidechain to work seamlessly with Axie Infinity), stealing approximately US$620 million in Ether and USDC.
Sky Mavis was unable to maintain its rapid growth due to an imbalanced issuance and burn mechanism for Axie’s in-game tokens
Smooth Love Potion (SLP) has gone into a downward spiral into an inflation period. This in-game token was issued without ample ways to destroy or burn it. This led to inflation, causing the token to lose value, disincentivizing players to continue using the game. Sky Mavis attempted to instill more burn mechanisms into the game, but it does not appear to have had the desired effects.
A recent report in the Financial Times suggested that one key reason for the SLP dip in price was players’ reaction to the slide of $SLP price. Players often convert their tokens into cash rather than reinvesting them in the game, contributing to a glut of tokens on the market, weighing on the price and worsening the situation.
Some predictions for the $SLP token
CoinCodex’s SLP fundamental analysis was bearish, with the price at $0.027 at the time of writing on May 11th. There were 25 indicators that gave bearish signals and three that gave bullish signals. But, according to CoinCodex’s short-term smooth love potion price prediction, the coin could fall 4% to $ 0.001 by May 16th.
Wallet Investor, an algorithm-based analysis site, was bearish in its long-term SLP crypto prediction. The site’s projection was that SLP to USD could trade down to $0.0015 by this time next year and by 2027, the price could fall to $0.0003, the data showed.
According to Gov Capital’s SLP coin price prediction, the price could fall to zero within the next year.
In contrast, the smooth love potion crypto price prediction from DigitalCoin expected the coin to move higher based on historical data, estimating that the price could average $0.014 in 2025, rising from $0.0095 in 2022 to an average of $0.033 by 2030.
Price Prediction’s SLP coin prediction was also positive on the outlook for the long term, projecting that the price of the smooth love potion token could rise from an average of $0.023 in 2022 to an average of $0.16 in 2025 and $0.48 in 2030.