What is Axie Infinity?

Axie Infinity is a blockchain-based game developed by Sky Mavis (Vietnam) where players collect, breed, and battle creatures called Axies represented as ERC-721 NFTs. The game became the most prominent example of the play-to-earn (P2E) model, in which players in lower-income countries — particularly the Philippines — earned the Smooth Love Potion (SLP) token through gameplay and converted it to income. Axie uses two tokens: AXS (governance and staking) and SLP (in-game reward and breeding currency), with gameplay running on the Ronin sidechain developed by Sky Mavis to reduce Ethereum gas costs.

Axie Infinity's play-to-earn boom between 2020 and early 2022 demonstrated both the potential and the fundamental fragility of token-incentivized gaming economies. At peak, the game had over 2.7 million daily active users and SLP prices made scholarship programs (where asset owners lent Axies to players who split SLP earnings) economically viable as supplemental income for participants in the Philippines, Venezuela, and other countries. The collapse was equally instructive: SLP's value depended entirely on new player demand for Axies, which required purchasing breeding inputs in SLP. When new player growth slowed, SLP inflation from continuous gameplay rewards overwhelmed demand, and the token entered a death spiral that destroyed income for scholars and erased most of the paper wealth accumulated by early Axie NFT holders.

The March 2022 Ronin bridge hack compounded the damage: attackers exploited a compromised validator key set and stole approximately $625 million in ETH and USDC, the largest DeFi hack at the time by dollar value. Sky Mavis reimbursed affected users through a combination of internal funds and a fundraising round but acknowledged the Ronin bridge had been secured by only 9 validators (5 controlled by Sky Mavis). The episode became a textbook case study in sidechain security tradeoffs. Subsequent Axie development has focused on reducing SLP inflation, restructuring the game economy around Axie Origins, and broadening Ronin into a general-purpose gaming blockchain for other titles — a strategic pivot from single-game dependency.

Reviewed by the 2Bitcoins Editorial Team · Updated June 2026. Not financial advice.