Many new players of the popular play-to-earn game Axie Infinity (AXS) join not through the standard procedure of buying the Axies they need in order to play, but instead by borrowing them from existing users, helping “the rich get richer” within the game, a new research claims.
Likely due to the currently high prices, “not many players are buying or breeding Axies which raises sustainability concerns,” according to the research from the multi-blockchain API provider Covalent.
Axies are characters that originally had to be purchased as non-fungible tokens (NFTs) in order to start playing Axie Infinity. New players were required to buy at least three Axies, while existing players are rewarded for breeding new Axies.
With increasing prices of the Axies, however, buying them has become a financial burden for some, the report said. It added that this has led to the emergence of “scholarship programs” where new users instead borrow the Axies they need from existing users.
“With the stagnant growth in Axie buyers, about 50% of traffic has been from previous buyers each month since September. The steady growth also implies a high churn rate for new users,” the report, written by Covalent researcher Brandon Rochon, said.
As a play-to-earn crypto-based game, players on Axie Infinity are rewarded in the form of SLP tokens for playing the game. But according to the report, the growth in players claiming SLPs is decreasing, while growth in new players on the game overall has remained stable.
It is “troubling” that a smaller share of the new players is claiming rewards, the report said, explaining that this represents a development within the game where “the rich get richer,” and that the game “could end of with an elite.”
“[…] this has the potential to dissuade new players from continuing and thus poses a risk to the game,” the report further warned.
Moreover, it also explained that breeding Axies, which is the only other way to get more of the creatures than buying or borrowing them, costs an increasing amount of SLP depending on how many times each Axie has bred before.
The benefits of breeding over buying Axies would thus be maximized when SLP prices are low and Axie prices are high, the report noted, adding that this is reflected in a decline in the number of breeders since August.
“[…] over 51% of the new users in May were also breeders. However, this percentage has steadily fallen to the point where only 2.7% of new users are breeding now,” Covalent’s researcher wrote.
Despite these challenges, however, the report also said that new players are joining Axie Infinity at “staggering rates that continue to increase each month.”
If the current growth rate continues, the popular play-to-earn game will have 10 million players by the end of December, the report estimated.