Axie is a new type of game that rewards players for the time and effort they spend both playing the game and growing the ecosystem.
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. Axies are created by players using in-game resources (SLP & AXS) and sold to new/other players. You can think of Axie as a nation with a real economy. The holders of the AXS token are the government that receives tax revenues. The inventors/builders of the game, Sky Mavis, hold ~20% of all AXS tokens.
Game resources and items are tokenized, meaning they can be sold to anyone, anywhere on open peer-to-peer markets.
Axie population growth is a major factor within the Axie ecosystem. At any given moment, there exists some ideal inflation rate that allows us to grow to our maximum potential. Too slow and Axie prices are too high for everyday people to join; especially competitive Axies. Too fast and you get unhealthy inflation.
Long term Axie population management relies on:
Adding additional utility to Axies through new experiences such as land, mini-games. This also adds utility to Axies beyond their effectiveness in fleeting metas.
Adding vertical, rather than purely horizontal progression. Right now in order to progress the main path that people take is by expanding the size of their collection. This dynamic is not optimal long term. In the long run there will be upgrades to both Axies AND Land that will require crafting ingredients. Axies themselves may be “released” to obtain these crafting ingredients. This creates a long term supply sink to the Axie population. Axie progression is coming in the future; and it promises to create a much stronger bond between trainers and the Axies they choose to upgrade.
Soulbound Axies, aka non-transferable Axies, that are competitive in the arena will allow anyone to compete and have fun. Earning potential for these soul bound Axies should be zero or close to zero; meaning that of course demand will remain for strong “real” battle Axies. Also keep in mind that demand for Axies is ultimately what also drives demand for SLP (and AXS), so creating more reasons to own Axies and making it easier for us to grow are important in a a healthy economy.
Transitioning from Growth-Dependency Using Network Strength
In the beginning, the Axie economy will be dependent on growth and new entrants. New players require Axies to get started, Axies price and breeding profitability will be determined by the demand from these prospective Axie players.This is much like any startup, growth is necessary in the early days.
However, as the size and strength of the Axie network grows there will increasingly be new sources of external capital into the ecosystem such as:
Advertising fees and sponsorships. Many projects are already eager to distribute rewards and tokens to the Axie economy. So far MakerDAO, AAVE, and Kyber Network have done experimental token drops to Axie players. Axie is already the largest community of people who understand how to use Blockchain technology in the world; there is immense value in advertising to a community like this.
Nonprofit organizations will be a major source of Axie demand and to pour capital from donors into Lunacia with no expectation of return; only the will to do good.
Government donations and grants. Axie is well poised to become a laboratory for Universal basic income experiments.
It's also important to note that many Axie players see Axie as a fun game and a social community to meet friends. More than 50% of Axie players prefer the gameplay and community to the economic aspect. These players value the fun and relationships that they make through Axie much higher than any potential earnings; these players make the economy stronger in the long run.
There are other types of value that Axie players gain through their journey such as:
Joy of owning a pet.
Fun, rest, and relaxation.
Making friends and finding business partners/mentors.
Learning how to use an important new technology. There's no need for paid "blockchain classes".