Is Axie Infinity A Good Investment?

Last Updated February 2nd 2022
14 Min Read

2021 has been a spectacular year for Non-Fungible Tokens (NFTs). Though they have been around for a while, their popularity has soared in recent times. Projects that utilize NFTs are all the rage now, and many experienced investors are making lots of money from the subsector. However, this doesn't mean that every coin or token in the subsector is a profitable investment vehicle.

Axie Infinity is an NFT-based online video game that uses Ethereum-based cryptocurrency (AXS). It has become one of the most popular video games in the world. This is primarily because players can make real money by playing the game. Like every other project with a native currency, Axie Infinity offers investment opportunities for traders. But is Axie Infinity a good investment?

It is not often easy to tell whether a cryptocurrency is a good investment, especially when it hasn’t been around for a long time. But it is important that you research every investment option before making a purchase. Here, we are going to answer some critical questions that can help you figure out whether Axie Infinity is a good investment.


What Is Axie Infinity

Axie Infinity is more or less a cute, NFT-based game that has attracted millions of users worldwide. According to its whitepaper, Axie Infinity is a Pokémon-inspired universe that allows anyone to earn digital tokens through skilled gameplay and contribution to the ecosystem. It is a pioneering network in the play-to-earn niche.

Axie Infinity is also a cryptocurrency project, by all standards. It is built on Ethereum and has several items that are represented by non-fungible tokens (NFTs). To secure its place in the blockchain universe and improve user experience, Axie Infinity has a custom-built sidechain that hosts its assets and resources. It is simply called Ronin.

Though Axie Infinity is neither the first nor only game on Ethereum, it has quickly climbed to the number one spot. It currently has the highest number of players and has generated more money than every other platform. It once generated more than $40 million dollars in just seven days. As hinted earlier, the network offers several revenue-generating opportunities to players and regular investors.

It is important to conclude this part by stating that Axie Infinity has a native currency, just like other cryptocurrency projects. Actually, it has two currencies, namely Axie Infinity Shards (AXS) and Smooth Love Potion (SLP). Though the two are both ERC-20 tokens, they serve different purposes in the Axie Infinity ecosystem. While AXS is the governance token and primary investment vehicle, SLP is used within the gaming aspect of the game.

If your intention is to determine whether Axie Infinity is a good investment then you need to focus more on AXS. It is the major digital asset you can trade on major exchanges and other reputable platforms to make money. SLP is also important, but you will have more need for it when you decide to play the game.  

Read More: What Is Axie Infinity? Should You Invest In AXS And Where To Buy It?

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

How Does Axie Infinity Work?

As hinted earlier, the “play-to-earn” model is one of the reasons Axie Infinity has become the biggest game in the blockchain industry. How exactly does this work?

Axie Infinity is a gaming universe where players can buy, borrow, breed, and use digital pets (simply called Axies) to battle and engage in adventures. Players will earn tokens by winning the battles and completing the adventures in the game. Players can also sell their Axies or rent them out to other players on a P2P marketplace.

Axie Infinity works great because most of the items players can acquire and earn can be converted to Ethereum and then to any fiat currency. Players can also use their in-game tokens to evolve their pets. The pets gain more statistics when they win battles. Their individual stats also determine how well they can perform in the three versus three battles and adventures. Of course, there are several other in-game resources, including plots of land. The more items you acquire, the bigger your earning potentials.

It will take a lot of space to explain Axie Infinity’s gameplay and features. Since we are trying to determine whether it is a good investment, we are going to start focusing on its primary investment too, AXS. Both gamers and regular cryptocurrency investors can buy the token from different platforms, including exchanges and brokerages.

How Do You Invest In Axie Infinity?

The straightforward way to invest in Axie Infinity is to buy Axie tokens (AXS). As severally stated, it is the primary investment vehicle in the ecosystem. Just like other digital currencies, it is volatile. Depending on the direction of the market, you can buy and sell at different times. To make a profit, you need to buy at a low price and sell when the price improves. It sounds simple, but the market is so unpredictable that you can get it wrong with timing and lose money.

Even if you are interested in playing the game to make money, you can also start investing by buying AXS. You will also need to earn or buy SLP. These tokens can be used to shop for pets and build them to be battle-ready. However, you should know that it is becoming a little pricey to buy pets and evolve them to the level that will make winning battles easier. The game is not the simplest game to play, but since it allows players to make money during their leisure time, it is still a good bet.

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

How Do You Make Money From Axie Infinity?

Depending on your interest, there are different ways to make money in Axie Infinity. Many gamers in the Philippines focus on playing the game to earn tokens. As hinted earlier, this may not be easy for most people, especially beginners with little gaming experience.

Of course, there are several other ways to make money from Axie Infinity. We will briefly discuss these different ways below:

1. Trading

Trading is the most straightforward way to earn money from Axie Infinity. Trading involves buying digital assets and selling at different times. You can use different strategies, including day-trading and HODLing. Day-trading involves buying and selling the asset often to take advantage of the volatile nature of the market. Day-traders can sell AXS holdings a few hours after buying or a few days afterwards.

HODLing is a long-term approach to cryptocurrency investing. It involves buying digital assets and waiting for months or even years for their prices to up before selling. If you don’t have enough time to engage in gaming or constant buying and selling, then HODLing AXS is the right way to invest in Axie Infinity.

2. Staking

Staking cryptocurrencies means locking them up for a given period to earn interest. Just like many platforms built on Ethereum, Axie Infinity allows network participants to stake AXS and earn rewards. Staking is a great way to earn passive income from cryptocurrency investment. You can stake while HODLing your assets.

3. Gameplay and other activities on the ecosystem

Of course, playing Axie Infinity gives gamers different opportunities to earn tokens and convert them to money. There are several activities you can engage in to earn money from the Axie Infinity universe. The network is expanding and new ways to make money may come up in the future.

Is Axie Infinity A Good Investment?

The popularity of the Axie Infinity community is growing even as you are reading this sentence. There are reports that people did quit their jobs to focus on playing the game in some countries. Considering how the AXS token has grown in 2021, it is not surprising that many cryptocurrency enthusiasts are adding it to their portfolio. Can we conclude from these events that Axie Infinity is a good investment?

The cryptocurrency market is more complicated than most people see. There are several factors that can lead to the growth of a cryptocurrency platform, including hype. Though Axie Infinity’s hype appears real, there are several other factors to consider before coming to a conclusion about how good of an investment it is.

At the moment, Axie Infinity appears like a digital asset that can explode in the coming years. But how long can it hold its place at the top of the blockchain gaming market? Does it have a long bright future ahead? What are the good sides of investing in AXS and what are the bad sides? We will answer these questions presently to help you figure out whether it is a good investment option for you.

Does Axie Infinity Have A Future?

We’ve seen some digital currencies rise and fall never to rise again. At the same time, we have seen coins that rise and fall and rise again several times in a year. The longevity of a cryptocurrency is tied to the value it offers and other important factors like adoption and partnerships. Does Axie Infinity have all of that?

In terms of value, Axie Infinity is a high-performance platform. It is a game that has transformed the gaming industry not just because it offers play-to-earn opportunities. It is a fun universe where players can have fun and earn money from their leisure activities. It will continue to appeal to many gamers and investors in the coming years. It will likely explode in the coming year.

As much as we would love to see Axie Infinity improve further and remain relevant in the blockchain industry, no one can tell with certainty how long the fanfare will last. The blockchain industry is fast-paced, and there are chances that better-designed games can knock Axie Infinity off its top spot in the future. Again, AXS is growing at a rate that is considered unsustainable by many. When the token gets to its peak and start falling, many gamers and investors will likely abandon Axie Infinity. However, no one can tell how long before this happens.

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What Are The Good Sides Of Axie Infinity?

Already, we have mentioned some of the positives that will make you want to invest in Axie Infinity. For the sake of emphasis, here are some of the good sides of Axie Infinity:

Axie Infinity has revolutionized the gaming industry and attracted millions of users from different parts of the world.

Axie Infinity is the number one gaming platform in blockchain and one of the best NFT-based projects. It offers the best of many worlds, which is why the token has grown so much in a short time.

Axie Infinity is run by a team of experts in the blockchain and gaming industries. They are working hard to keep the platform at the top.

Axie Infinity has enough infrastructure and features to support gamers and regular cryptocurrency investors.

Axie Infinity has two ERC-20 tokens (AXS and SLP), and both are tradable on the Ethereum network. However, AXS is the focus of this article since it is the primary investment vehicle that is available on different platforms.

AXS has performed wonders within 12 months and looks poised for more exploits.

Axie Infinity offers different money-making opportunities for skilled gamers and others who are not so good at gameplay.

Axie Infinity allows for staking, which is an excellent way to make money from your cryptocurrency investment without having to buy and sell at all times. You can also stake while HODLing, with the hope that your investment will amount to so much when it is time to cash out.

AXS is a governance token, which means it gives holders voting rights in the Axie Infinity decentralized organization, to determine how the network is run.

AXS has performed really well, though it was listed in major cryptocurrency exchanges not too long ago.

AXS is now available on many exchanges and brokerages, which means you investors will have no trouble at all buying or selling their tokens.

What Are The Bad Sides Of Axie Infinity?

While there are several positive things about Axie Infinity, there are some negative things about the network and its token you need to know too. We will briefly highlight the bad sides of Axie Infinity that may make you reconsider investing in it:

Axie Infinity has been around for a few years and its major token, AXS, was recently made available on many exchanges. Though it has grown significantly in about 12 months, there is still not enough historical data to predict its future.

AXS, the primary investment vehicle in Axie Infinity, has shown signs of extreme volatility, which is a bad sign. Though every cryptocurrency is considered volatile, extreme volatility can lead to huge losses.

The fast-paced nature of the cryptocurrency universe means that another gaming platform can rise up in the coming years and knock Axie Infinity off its top spot.

Once AXS reaches its peak and starts falling, many gamers and regular investors will likely abandon the platform, and this will further push down the value/price of the token. It can be a huge loss for people who will buy when it is at its peak. Considering how fast AXS is growing, this can happen rather quickly.

AXS is already pricey, and it is becoming increasingly expensive to start buying Axies and other in-game resources in Axie Infinity. The profit potential is steadily diminishing.

Axie Infinity may have an inflation problem, and without more players, it will likely become too tough to fix.

Should You Invest In Axie Infinity?

We have covered most of the important things you need to consider before making up your mind about investing in Axie Infinity or ignoring it for other investment options. But should you invest in the network and its token?

Axie infinity can be a profitable investment. In fact, people who invested in AXS in the early days had a lot to celebrate in November 2021, when the coin reached its all-time high of $165.37 per token. According to Coin Market Cap, Axie Infinity’s ROI stands at 52,167.87%, which is amazing. The coin has the potential to command higher prices in the future. You can still invest now, even as many new players are joining the community.

As previously stressed, there are also bad sides to Axie Infinity. Though the network and its token are growing at a remarkable rate, its future is not too certain. It may grow more valuable in the coming years, but there are chances that it will reach its peak rather quickly. Again, another gaming platform can steal the shine from Axie Infinity. While AXS is still a good short-time investment option, it may not be the best fit for long-term investors.

Check Out: Will Axie Infinity Make Me Rich In 10 Years?

The Best Way To Invest In Axie Infinity

Investing in Axie Infinity can be profitable, but you need to understand its shortcomings and determine the best approach to take. As stated in the previous paragraph, Axie Infinity is looking good for short-term investing. Day-trading AXS can be a good way to get started. If you wish to make money during your leisure time, then you can consider playing the game, buying some of the in-game resources, and completing other tasks (like breeding Axies, the digital pets) to earn NFTs.

You also need to realize that it is crucial to choose the right platform when it comes to buying and eToro selling cryptocurrencies. There are several options out there, but is one of the best places to buy AXS and other digital tokens. The brokerage is recognized as one of the best social trading platforms and offers users several perks.

eToro – The Best Platform To Buy Axie Infinity

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Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.