In the field of play-to-earn gaming, the name of Axie Infinity stands like a colossus above all the rest.
Initially launched in March 2018, the online game based on non-fungible tokens (NFTs) went on to become a worldwide sensation, toasted as a true crypto success story.
By Nov. 2021, Axie Infinity’s token, AXS, had soared from a few cents per token to an all-time high of $164.90. Such was the huge success of Axie Infinity that during its peak in 2021, tens of thousands of gamers were able to carve out a living just from playing.
Then, in March, Axie Infinity and its users lost $620 million in a cybercrime attack funded by North Korea. The loss was a heavy blow for the company, but, perhaps surprisingly, not a fatal one.
Today Axie Infinity (AXS) is down 92.3% from its peak to around $12 a share, but the game and its parent company, Sky Mavis, continue to fight on.
Be[In]Crypto spoke with Aleksander Leonard Larsen, the Chief Operating Office (COO) of Sky Mavis to find out what the company is doing now and why Axie is perfectly placed for a major comeback story.
Axie community and network effects
One of the things which Larsen, more popularly known as Psycheout, is keen to share with us is the reasons for Axie Infinity’s success. While Larsen could self-congratulate on the creation of Axie Infinity, the gaming chief instead points to the community as one of the key differentiating factors.
“I would say that rather than the Axie classic game being the really secret sauce, the community was always the secret sauce of Axie,” said Larsen. As for the game itself Larsen cites the two token model as one of the important innovations within the game.
Having tasted success through Axie Infinity, Sky Mavis is now developing its next game titled Axie Origins, which will apply the lessons learned from what Larsen sometimes refers to as “Axie classic.”
On what Sky Mavis has taken from the experience Larsen said “we should have been a little bit more careful with the [token] inflation,” but that overall Axie classic was a “great learning experience.”
“If you look at just the newest user numbers, and just how many people discovered the game, now we have the opportunity to build on top of that, as we’re releasing the next games.”
Axie taking crypto by storm again
Larsen believes that the company is now in a great position to take crypto by storm again, primarily due to the loyal community of gamers the company has built up over the years. The existing gaming community of Axie players creates a “networking effect” of in-built fans, as long as Sky Mavis gets the game itself right.
“The really hard thing is to bootstrap network effects,” said Larsen. “In the traditional gaming industry, a lot of games are being shipped every single day. And most of them fail, like bootstrapping network effects, or IP (intellectual property) is really very, very difficult. And that’s really the competitive advantage that Axie has right now.”
For that reason Larsen has a message for gamers who are looking for “the next Axie Infinity.”
“Axie is the new Axie, because we’re shipping games now that they are in the ecosystem using the same assets,” said Larsen.
“That’s really going to be the future of Axie infinity – more games, an ever expanding ecosystem of different things that players can do.”
So while the number of Axie Infinity users may be down from their peak, the operations chief points out that this reduced number is still far ahead of competitor ecosystems and products.
Casual gamers are the future, says Larsen
One area Sky Mavis has identified for growth potential is casual, non-crypto gamers.
“For us, everything is about now going into the market outside the crypto space, and making sure that we have regular gamers who just love the products,” said Larsen.
Larsen sees a future for the company in which some players find Axie through their app store and play outside the crypto ecosystem, “and then if you want to become a blockchain player, if you want to earn something, or if you want to participate in the economy… that’s when you interact with the crypto side of things.”
Part of bringing new users into the crypto fold will be in education. As Larsen puts it, “Why should normal people care about this?”
That’s a larger question which crypto corporations of all shapes and sizes eventually need to answer.
Lessons learned from the Ronin attack
Finally, we asked Larsen about the elephant in the room, the $620 million attack and what that has meant for the company. Here Larsen expresses regret over what happened.
“Looking back, I wish we had more validators, and we had been more secure,” said Larsen. “We’ve taken it to heart, it’s a big learning experience.”
The company will now look to restore trust from its users and to make the system more robust and secure. In that second goal the company has now added Google to its list of validators, something that Sky Mavis believes will improve the security of the network.
Now the company is focused on launching its next game Axie Origins, which promises improvements over its predecessor, including better gameplay mechanics and a free to play entry model.
Will Origins be the next Axie Infinity as Larsen believes? This is crypto, where anything is possible.