What Is Axie Infinity? Axie Infinity Crypto Explained
Last Updated: June 2026
Axie Infinity became one of the most talked-about projects in crypto history by merging blockchain technology with competitive gameplay. Developed by Vietnamese studio Sky Mavis, it introduced millions of players — particularly in Southeast Asia — to the concept of play-to-earn (P2E), where time spent in a game translates into real economic value. At the center of this ecosystem are two tokens: AXS (Axie Infinity Shards) and SLP (Smooth Love Potion). Whether you are a gamer evaluating the project or a trader exploring spot trading opportunities, understanding how Axie Infinity works gives important context for the AXS market. The game runs on the Ronin sidechain, a dedicated Ethereum-linked network designed to eliminate the gas fees that would otherwise make in-game transactions impractical. This infrastructure decision proved central to Axie's scalability — and to one of crypto's most costly security incidents.
How Axie Infinity Works
Axie Infinity is a turn-based strategy game where players collect, breed, and battle fantasy creatures called Axies. Each Axie is an NFT with unique attributes — body parts that determine its class, stats, and move set. Players build teams of three Axies and compete in player-vs-player (PvP) or player-vs-environment (PvE) modes.
The play-to-earn loop is straightforward: winning battles earns SLP tokens, which can be sold on open markets or used to breed new Axies. Breeding combines two Axies to produce offspring with mixed traits, and the resulting Axie NFTs can be sold in the Axie Marketplace. This created an economy where skilled players and efficient breeders could generate meaningful income — at the model's peak in 2021, daily SLP earnings exceeded minimum wages in the Philippines, driving a surge in adoption.
Axies are not cheap to acquire individually. To lower the barrier to entry, the community developed scholarship programs where NFT owners lend their Axies to players (scholars) in exchange for a share of earnings. This became a micro-economy of its own, especially in countries where entry costs were prohibitive.
AXS Token: Governance, Staking, and Value
AXS is the protocol's governance token with a hard cap of 270 million tokens. Its primary functions are:
- Governance — AXS holders vote on proposals that shape the game's development, treasury spending, and protocol rules through the Axie DAO.
- Staking — Users can stake AXS to earn a portion of fees generated across the Axie ecosystem, including marketplace transactions.
- Treasury interaction — A community treasury accumulates AXS from marketplace fees, and governance votes determine how those funds are allocated.
- In-game utility — AXS is required for certain high-level breeding actions and tournament participation.
The staking APR has varied significantly over time, influenced by the number of stakers and treasury inflows, making it more attractive during periods of high game activity.
AXS vs. SLP: Understanding the Dual-Token Model
| Feature | AXS | SLP | |---|---|---| | Full name | Axie Infinity Shards | Smooth Love Potion | | Supply | Fixed at 270 million | Uncapped (inflationary) | | Primary use | Governance, staking | Breeding Axies | | Earning method | Staking, tournaments | Daily quests, PvP battles | | Price behavior | Demand-driven, scarcer | Supply-sensitive, volatile |
This dual-token model was intentional: AXS was designed to hold value through scarcity and governance utility, while SLP served as a spendable in-game currency. However, the model exposed a structural weakness. As Axie's popularity grew in 2021, SLP issuance vastly outpaced burning (consumption through breeding), causing severe inflation. SLP's price collapsed from over $0.35 in mid-2021 to fractions of a cent by 2022 — eroding earnings for scholars and illustrating the difficulty of designing sustainable tokenomics in a P2E game.
Sky Mavis responded with several adjustments: reducing SLP rewards in PvE modes, increasing breeding costs, and introducing Axie Infinity: Origins, a revamped game mode with refined economics aimed at longer-term balance.
Trading AXS on EVEDEX
For traders, AXS represents exposure to the gaming and NFT sector of crypto — a category that moves with sentiment around Web3 adoption, broader market cycles, and Sky Mavis product announcements. AXS is available for leverage trading on EVEDEX, where you can take long or short positions without needing to manage Ronin wallet setup or Axie NFT purchases.
EVEDEX is a decentralized crypto exchange built for derivatives, meaning you interact directly from your wallet without a central custodian holding your funds. You can open an AXS/USDC perpetual position, set your leverage level, and manage risk with stop-loss and take-profit orders — all on-chain. For traders who want price exposure to gaming tokens during news cycles (such as new game releases, partnership announcements, or DAO votes), this is a direct and capital-efficient approach.
If you prefer straightforward ownership, AXS spot markets on crypto futures-adjacent platforms allow you to build a position and stake through Sky Mavis's official staking dashboard to earn passive yield while holding.
The Ronin Hack and Recovery
No account of Axie Infinity is complete without addressing the March 2022 Ronin Bridge exploit, in which hackers — later attributed to the Lazarus Group — stole approximately $625 million in ETH and USDC by compromising validator private keys. It remains one of the largest crypto hacks in history.
Sky Mavis's response included raising $150 million from Binance and investors to reimburse affected users and overhauling the Ronin validator set to improve decentralization. The network was relaunched with enhanced security, and Sky Mavis continued building — a sign of organizational resilience that distinguishes it from many post-hack projects that collapsed entirely. For traders and investors, the hack is a reminder that even well-resourced teams building genuinely innovative products carry bridge security risk — a factor worth weighing alongside any fundamental analysis of AXS.
