By Michael Scott
Axie Infinity’s Smooth Love Potion token is being revamped, including a limited supply as well as a ‘stability fund’ to back it. The game studio Sky Mavis’ current development play-to-earn behemoth challenging Axie Infinity possesses three crypto tokens linked to its ecosystem.
An example is the Smooth Love Potion (SLP), which is undergoing a significant modification to balance its earning structure. On Wednesday, the Axie team revealed that a supply restriction had been put in place for this crypto token, restricting the token number to 44 billion. This is not a technical limit implemented by a new smart contract responsible for how it functions.
Axie Infinity Reducing Supply of SLP Token
Rather, Sky Mavis noted that it is a ‘social contract’ whose enforcement will partially be done via metering in-game rewards to maintain the restriction. At present, an estimated 41.4 billion SLPs are circulating.
Smooth Love Potion is Axie’s primary in-game currency whose earning can happen via gameplay. AXS refers to its governance token, while RON refers to the gas (transaction cost) token of Axie’s centered on Ronin blockchain.
The Axie Infinity team expects to reduce the deflation rate of Smooth Love Potion to 2%, and a ‘stability fund’ has been created. The update showed that the team intends to incorporate two SLPs into the fund for each of the ten burned SLPs.
For a start, 60000 USDC has been incorporated into the fund. A blog post revealed that the stability fund ‘automatically purchases Smooth Love Potion when inflation is greater compared to the target and sells the token when inflation is lower compared to targeted.’
In the post, the team said this program aims to develop a consistent and steady demand source for Smooth Love Potion and balance demand with supply. Following the news, SLP’s price rose nearly 8%. However, CoinGecko data shows that the price is still down nearly 2% in the last week.
Changes in the Gaming Industry
This token remains down more than 99% from its peak three years ago. At that time, the number of active Axie Infinity players was significant. One can earn SLP by willing games in Axie Infinity.
However, the team has also unveiled Premium Cursed Coliseum, a new game mode in which players intending to join should pay a one-time fee of 150 Smooth Love Potion. Additionally, 50 SLPs can be earned for three wins, 150 SLPs for six wins, and 300 SLPs for nine wins.
A post revealed that 3000 SLP would be awarded to those who win 12 games without losing any match. Finally, 20% of the entry fees will be burned, and the rest will be moved to a growth fund. However, the team said the portion might vary monthly moving forward.
It is also critical to note that despite the inability to cash out or withdraw Smooth Love Potion earned from the new Coliseum mode, this integral feature’s availability ‘in the next month or two’ is possible.
Overview of SLP Market Performance
Axie Infinity was unveiled in 2018 and experienced significant growth in 2021 and early 2022. This drove the first boom in play-to-earn crypto games as well as an earning of billions of dollars from nonfungible token (NFT) trades.
However, in the spring and summer of 2021, the SLP attained all-time highs. In turn, its value plummeted and has yet to get back to a price even remotely near its earlier highs.
In early 2022, the value of the game’s assets was reduced. At that time, Sky Mavis faulted SLP inflation as a significant issue with its play-to-earn economy.
In this case, more than four times the Smooth Love Portion was being given every day compared to what was being destroyed or burned via the Axie monster breeding process.
Editorial credit: TongRoRo / Shutterstock.com