Samerson Orias, a former line cook from the Philippines, was told by a friend that it would be a lot more fun to play a video game.
Orias earned approximately 4,000 pesos per month (which is about $80 less than the national minimum wage). Takotai—Japanese octopus balls. He was told by a friend that he, along with others, were making up to $600 per month from playing. Axie Infinity, This game is powered by crypto and NFTs.
Orias was 26 and desperately needed an escape from his financial troubles. His mother suffered a stroke, required medication and his electricity and groceries bills had been mounting up. He decided to plunge into Axie, He fought cartoon monsters all night long. He began to earn cryptocurrency that he then converted into pesos. It allowed him better care for his mother and home. At the time, thousands were joining the game from the Philippines. For a brief moment at the peak of crypto’s astonishing 2021 boom, these young Filipino players were fulfilling a longtime dream of crypto’s most ardent evangelists: that “play-to-earn” blockchain games like AxieThis could pave the way for a fairer, more open global economy.
Orias looks at family photos from his house.
Ezra Acayan, TIME
Orias cooks at a Takoyaki shop.
Ezra Acayan, TIME
Fourteen months later, most Filipino players, including Orias, have exited the game nursing anger and anxiety—and, in some cases, thousands of dollars down. Orias hated the game. He said it was tedious and stressful. This is a refrain that is common among all the players TIME interviewed. “I felt fatigued all the time. I became more aggressive in every aspect of my life,” he says.
Orias’ story and Axie Infinity This serves as cautionary tale to crypto’s brash rhetoric about changing the globe. While many crypto think leaders are critical of some aspects, they point to the positive effects it has on developing nations. Orias says and many others that Axie Infinity They gave false hope to predatory systems, and reinforced them. Innovative metaverse ideas, such as Axie Infinity offer immense promise—but also tangible peril for those who feel they have no other option but to take the plunge into the digital unknown.
At first glance, Axie Infinity looks a lot like Pokémon. Players purchase three adorable cartoon Axies to enter the game. Each Axie has its own strengths and weaknesses. The Axies then fight other Axies to become more powerful. Players can earn Smooth Love Potion (SLP) in-game currency, which they can exchange for other cryptocurrency. An Axie can also be traded or used as breeding material to create new and more valuable creatures. An NFT is the unique token of ownership for each Axie creature. This is a secured ledger that records transactions and secures their ownership. It has been hailed by many as an important technology for the future of metaverse evolution.
Axie Infinity Sky Mavis Inc., an American startup based in Vietnam, developed the game as part of its growing play-to-earn gaming movement. Other popular games include League of Legends And Fortnite, it’s common for elite players to make a living through sponsorships and revenue from streaming their games to online viewers. There are many ways to make a living as a professional player. Axie Infinity,The game’s earning potential is built into its gameplay. “We believe in a world future where work and play become one,” the game’s website stated last year.
Sky Mavis receives a portion of the in-game transaction fees and keeps a substantial stash of tokens. In October last year, Sky Mavis had raised $150 million from investors such as Andreessen Horowitz.
In the Philippines, it made an immediate impact. At one point, players there made up 40% of the game’s user base. About 25% of the nation’s 110 million residents in Southeast Asia are below the poverty line. Its economy heavily depends on the 2.2million migrant workers returning money from home. These workers fled home as many were forced to leave due to the global pandemic that closed down borders and cut off jobs. Due to the prolonged COVID-19 lockdowns, which had crippled local economies for many years, people tried multiple money-making strategies to get by.
Owen Convocar, a Rizal-based gamer, heard murmurs about Axie’s earning potential for months in early 2020 before he decided to enter the game as a scholar. He earned $487 in 15 days. Soon, he invested $1,200 in his Axie Monsters to purchase them. He split the cost with his mother, who shared it 60/40.
Convocar’s early victories in the pandemic era brought international attention and hundreds of thousands more players to the game. But as the game’s popularity increased, observers pointed out that its economic structure was unsustainable: the value of SLP necessitated new players continually buying in, much like a Ponzi scheme. Sky Mavis’ team even acknowledged in its white paper that the game was “dependent on new entrants.”
“Focusing on growing a network through early incentives does not make a Ponzi scheme,” a representative for Sky Mavis wrote in an email to TIME. “Axie Infinity’s main purpose is to provide entertainment.”
Many players who wanted to play in the game found it difficult to pay for their first monsters as SLP prices continued to rise. So an employment scheme emerged in which wealthier investors, known as “managers,” would buy Axie monsters and then lend them out to “scholars,” who would handle the grunt work of leveling up. The owners of the monsters would then pocket anywhere from 30% to 50% of the scholars’ profits, according to players interviewed by TIME. It was not controlled by Axie owner Axie, who forged the contracts. They portrayed the system as an opportunity to distribute the wealth. Orias hoped to be one of the system’s beneficiaries last May, when he signed up with a manager based in Australia. The manager required him to earn a minimum of 120 SLPs a day—which would take five to six hours of game play—and would pocket half of Orias’ earnings.
Albert Oasnon is an Axie manager. He plays at home in Cavite in Imus on the outskirts Manila in Philippines on July 19, 2022. Oasnon is a content marketer and runs a media company. He says that he managed around 20 scholars during last year’s game peak.
Ezra Acayan, TIME
Orias devised a routine for his daily cooking. TakotaiBetween 3 and midnight, I came back home to play AxieThrough the early hours of the morning. After giving his manager the exact amount, his play netted him $29 per week. But his relentless schedule, and the game’s randomness, exhausted and frustrated him. “At first I was happy. After a while, however, I began to notice that I was gradually becoming weaker. There was sleeplessness and the stress of the game,” he says.
Orias was to return to the game each Wednesday in August to check the value of the in-game currency. As more players entered the game and generated more and more SLP tokens, each token’s value decreased. Naavik, a research company, reported November that the average earnings were for Axie scholars had dropped below the Philippines’ minimum wage.
The bottom was out of crypto markets by spring 2022. This made it almost worthless to play the game. Although Axie InfinityAlthough the platform boasted over 2.5 million users daily, 760,000 people are currently active, one tracker shows. The value of SLP peaked at $0.34 last July; it’s currently worth less than half a penny.
Sky Mavis was trying to tweak its game design to make the system viable again when a larger disaster struck. In March, a hacker targeted the “bridge” upon which money was transferred between Sky Mavis’ blockchain Ronin and the much larger cryptocurrency Ethereum. Bridges that connect chains to each other are among the most dangerous parts of blockchain ecosystems. The network was immediately emptied of more than $600million, two-thirds belonging to the users. While Sky Mavis returned all funds, the hack demoralized the game’s user base.
Sky Mavis, at the moment, is doing a hard turn, de-emphasizing Axie’s “play-to-earn” nature and introducing a new version, Axie Infinity: Origin, that doesn’t involve crypto at all. The developers hope that players will stay for both the gameplay and making money from in-game purchases and experiences.
The blockchain gaming sector continues to receive huge amounts of funding. Ready Player DAO, a gaming company that uses blockchain technology to make money received $150 million in April as part of a $10.2 million round. Ethan McMahon from Chainalysis is an economist. Axie’s failures portend badly for crypto’s once rosy play-to-earn future. “Maybe a select group of the best players will actually be able to earn from games. But any given person’s starting motivation to play will not just be for profit,” he says.
Filipino economists who heard that blockchain games would lead to radical economic transformation are now confused and dejected. TIME spoke to several scholars who said that they owe thousands or hundreds of dollars to their family and friends for helping them to pay the initial investment. However, this has led to their monstrous monsters becoming worthless. Convocar’s AxieIn March his account was hacked, and it cost him $190 to recoup the losses. “I took good care of my Axies, and my account became invalid,” he tells TIME. He soon quit.
Orias (right), and Jonathan Artates, his childhood friend, at the Takoyaki Shop in San Mateo Rizal in San Mateo on July 19, 2022. Artates introduced Orias the Axie Infinity video game. After his account had been hacked, he quit the game.
Ezra Acayan, TIME
Orias left the game around the last week of summer after his mother had a heart attack. He lost all his savings and the $200 he saved to play at her funeral. Axie. “I felt regret that I wasn’t able to provide for my mom,” he says.
Now he’s back in the TakotaiHe plans to open a food stand and save money for the future. “For those having a hard time, for those pushed to their wit’s end,” he says of Axie, “stop playing.”
—Reporting by Julia Zorthian
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