Play-to-Earn: The Game Nobody Wanted to Play

Christopher Cruz ran 200 players in the Philippines in 2021. They played a cartoon game on borrowed accounts, he kept 60% of what they earned, and on his best days his cut came to 600,000 pesos, more than $10,000. "I felt like a drug lord," he told the Thomson Reuters Foundation in 2023. By then the game's reward token had lost 99% of its value and almost all of his players were gone.

The game was Axie Infinity, made by Sky Mavis, a studio founded in Vietnam. For a few months in 2021 it was the proof that a new idea worked: play-to-earn, games that pay their players in cryptocurrency for the hours they put in. It turned out to be proof of something else.

The boom: $364 million in one month

Axie Infinity looked like a cheap copy of Pokemon. Players collected small creatures called Axies, built teams of three, and fought other teams. What made it different was ownership. Each Axie was an NFT, short for non-fungible token, which works like a numbered ownership certificate for a digital item, held in the player's own crypto wallet and sellable to anyone.

Winning battles paid out a token called Smooth Love Potion, or SLP, which players could sell for real money on crypto exchanges, the crypto version of a broker. The game also had a second token, AXS, which worked more like a share in the project: holders could vote on its future and earn a slice of its fees.

During the pandemic lockdowns, the sums were remarkable. Axie earned about $196 million in July 2021 and about $364 million in August 2021, according to figures from the tracker AxieWorld reported by Crypto Briefing and Nairametrics. For that month, among crypto projects, only Ethereum itself took in more fees. Daily players grew to a peak of about 2.7 million, and roughly half of them were in the Philippines, with others in Indonesia, Brazil, Venezuela and Peru.

There was a catch at the door. A starting team of three Axies cost hundreds of dollars at the 2021 peak, out of reach for the people who most wanted the wages. So the market invented "scholarships". Investors bought teams, lent them to players called scholars, and split the winnings. Yield Guild Games, a Philippine-led gaming guild backed by the venture firm Andreessen Horowitz, ran one of the largest programmes, with a split of 70% to the scholar, 20% to the manager and 10% to the guild, according to BitPinas. Other managers, like Cruz, took far more.

Where the money really came from

Every SLP a player sold had to be bought by someone. In Axie, the main buyers were new players and breeders. SLP was spent to breed new Axies, and new Axies were sold to newcomers who needed a team. As long as the newcomers kept arriving, the wages kept flowing.

The game printed far more SLP than it used. In February 2022 the developers said around four times more SLP was being created each day than was being burned through breeding, as reported by BitPinas and Cointelegraph. A share trader would recognise the pattern: a company paying its dividend by issuing new shares to new investors. The payouts look real until the new money slows.

The new money slowed in late 2021. SLP had already peaked at about 40 cents in July 2021. AXS reached its all-time high of $164.90 on 6 November 2021, according to CoinGecko, and fell from there. To slow the printing, Sky Mavis stopped paying SLP for adventure mode and daily quests from 9 February 2022 and cut arena rewards. The scholars' income shrank overnight. The base price of a single Axie had fallen from around $300 in August 2021 to about $25 by February 2022.

The Ronin heist

Then the bank vault went. Axie ran on Ronin, a separate blockchain that Sky Mavis built so that battles and trades would be fast and cheap. Players moved money between Ethereum and Ronin through the Ronin Bridge, which works like a currency exchange booth between two countries: it holds the deposits on one side and issues matching tokens on the other.

On 23 March 2022, attackers who had obtained five of the nine keys needed to approve withdrawals drained 173,600 ETH and 25.5 million USDC, about $625 million. Nobody noticed for six days. On 14 April 2022 the FBI attributed the theft to North Korea's Lazarus Group. Sky Mavis raised $150 million in a round led by Binance and repaid users one for one when the bridge reopened on 28 June 2022, but the damage to confidence was done.

Time magazine reported in July 2022 that Axie's daily players had fallen from over 2.7 million to about 760,000, and that some scholars owed friends and family hundreds or thousands of dollars after their creatures became worthless. By April 2023 the figure was about 250,000. SLP had lost 99% from its February 2022 high. Gian Carlo McGlay, a manager who had bought teams for his scholars, told the Thomson Reuters Foundation he lost about 1 million pesos, roughly $18,000. Elaine Tinio, a Manila marketing professional, faced a loss of 200,000 pesos, about five months of her salary. "Greed got the best of us," she said.

The copycats and the long tail

The same model spread beyond Axie and failed the same way. STEPN, a "move-to-earn" app that paid users in tokens for walking and running in NFT sneakers, saw its GMT token peak at $4.11 at the end of April 2022. In late May the operator said it would cut off users in mainland China from 15 July, and its tokens dropped sharply on the news, as Bloomberg and Decrypt reported. GMT trades at under one cent on 16 October 2026, according to CoinGecko. Its reward token, GST, which peaked above $8, trades at about one tenth of a cent.

Yield Guild Games moved towards training its members rather than renting them assets. Its Philippine manager Luis Buenaventura said in 2023 that players who were there only for money "have moved on".

Sky Mavis survived by shrinking the promise. It launched Axie Infinity: Origins, which pays far less, introduced a non-transferable in-game version of AXS called bonded AXS, and is building a new title, Atia's Legacy. On 12 May 2026 Ronin became a layer 2 network on Ethereum, a satellite chain that settles its records on Ethereum, rather than a standalone chain. In August 2026 Sky Mavis said Season 16 of Axie Classic, the original game that made the scholars' fortunes, would be the last under its management. After 10 September 2026 it paused competitive seasons and feature work and began handing the game to its community, as BitPinas and BlockchainGamerBiz reported. "The details aren't settled yet," the company said.

On 16 October 2026, AXS trades at $1.07, down more than 99% from its peak, and SLP at about six hundredths of a cent. The game is still running. The wage is not.