Sky Mavis soft launches Axie Infinity: Origin as a free-to-play title

Sky Mavis, the creator of the popular blockchain game Axie Infinity, announced the global early access release of its free-to-play game Axie Infinity: Origin.

The launch of the more accessible web-based brand new game in the Axie franchise comes a week after Sky Mavis’ Ronin Network was hacked in a heist where thieves stole $624 million from Axie Infinity players and Sky Mavis. That means there is a lot at stake in the launch of the new game in restoring confidence in Sky Mavis.

That amounts to a lot of pressure for the game to succeed, but Sky Mavis also announced today that it had raised $150 million in funding from Binance and other investors. That should help assuage concerns that anyone has about the company being able to meet immediate working capital needs, the company believes.

The new standalone free-to-play Origin web game is available for downloading on Mavis Hub, Sky Mavis’ distribution platform. Originally, the free-to-play alpha test was supposed to launch last week, but the company pushed the launch back to today after the hack, said Jeff Zirlin, a cofounder of Sky Mavis and growth lead. It isn’t available on Android or iOS yet, but a web-based mobile version is coming.

“We wanted to keep pushing, and we wanted to make progress and, and show the community our hard work,” Zirlin said. “So that’s why we’re going forward with the early access launch this week. And we’re really excited about it. I think the community is super excited as well.”

The current Axie Infinity game has more 1.5 million daily active users, but that game is less accessible to people on a budget because it requires players to mint their Axies, or creatures, in cryptocurrency transactions that can cost anywhere from $20 per Axie today. In the past, it cost hundreds of dollars to mint the three Axies required to start playing the game.

The cost of minting and breeding Axies depends on the price of the Axie Infinity tokens known as Axie Infinity Shards (AXS) and the in-game currency Smooth Love Potion (SLP). These steep startup costs for minting Axies kept some players away from the game, and it led guilds of players to provide scholarships to those who couldn’t afford the fee.

The price was a big hurdle because Axie Infinity became popular in places like the Philippines, where the pandemic took a toll on the job market, and people turned to Axie Infinity to earn a living. In the early days of the pandemic, players learned they could earn multiple times the minimum wage to play. And once they started playing, they could level up their characters and sell them for a profit to other players in what was called “play-to-earn” games.

Players can buy and sell their Axie characters as a right that proves their ownership, in contrast to games where players aren’t allowed to resell anything. Sky Mavis charges a 4.25% fee to players when they trade Axies on its marketplace.

These games used non-fungible tokens (NFTs) to uniquely identify each Axie character so that the scarcity could be authenticated. In that way, Axie Infinity has been the flagship game of play-to-earn (where players can make money from playing a game by collecting digital assets and reselling them) blockchain games, and it enabled Sky Mavis to raise $152 million at a $3 billion valuation in October 2021. Even after the hack, AXS tokens are still worth billions of dollars.

NFT critics

But critics said the collectible card style gameplay was crappy and the NFT structure amounted to a Ponzi scheme, where the main source of new revenue was new players coming into the game. So early players built up their Axies and made them more valuable, selling them to those who came next. The problem with that approach is that you eventually run low on new players. Hardcore players also criticized the axolotyl inspired 2D art work of the cute characters, but Zirlin noted with price that the game and its art were designed to run on any smartphone.

Demand for Axie Infinity exploded in the summer, but in the late summer and fall the economy turned. Players started leaving, and the price of AXS fell. With the fall in price, it became harder to balance the game’s economy. And critics also noted that the design of the game didn’t have enough ways to keep players spending money in the game. Meanwhile, those who depended on it for a living found they couldn’t make as much money anymore.

That could have started a catastrophic decline. Monthly active users are still strong at 1.5 million daily active users, but Zirlin acknowledged that it down from the peak of 2.8 million monthly active users. Even so, it remains the largest player-owned economy in the world, he said.

And Sky Mavis didn’t just sit on the cash it raked in. It invested it. Fortunately for Sky Mavis, it hired 130 people and invested in making the new Origin game for about a year and a half, said Zirlin. Even as the fortunes of Axie Infinity, which was considered in beta form, started to slip, the company hoped to launch a new source of revenue.

To deal with the rising cost of transactions, Sky Mavis developed its own sidechain, the Ethereum-linked Ronin Network, which enabled it to do more transactions at a lower cost. But that’s how the network eventually got hacked.

A different kind of community

Zirlin believes that people are sticking around based on the strength and size of the community. Critics said that players only wanted to make money rather than enjoy the game. But this kind of player — the kind who actually spent money in the game — was very different. Rather than being purely speculators or wealthier Western gamers, the players were mostly in emerging markets like The Philippines, Malaysia, Nigeria, and elsewhere.

While many hardcore gamers have looked down on Axie Infinity, those in emerging markets embraced it. About 20% to 25% of the players never had a bank account, Zirlin said. Rather than viewing these players as cannon fodder, they were more like the true believers who felt it could help them make a living. (I call this the Leisure economy, where one day we will all make money playing games).

“The more people who play the game, the more fun the game is and the more fun the community is,” Zirlin said. “It’s always awesome to have a new generation of Axie trainers come in. People can finally show their friends and family what they’ve been obsessed about.”

Sky Mavis’ founders believed in the power of web 3 and decentralization. Zirlin noted in the past that the company didn’t have to play 30% to an app store or spend 40% on user acquisition. So it had more money left over to share with its players, who could help the game go viral through their enthusiasm for it and word of mouth. By investing heavily in community, the company could share more wealth with players and even lift some out of poverty.

There are, of course, many risks to that kind of dream, as we saw when the price of AXS fell. But during the pandemic, Axie Infinity served its purpose for millions of people.

People will now be able to spend money on sinks in the economy, which will help the overall health and balance of the game, Zirlin said. They can use tokens to upgrade Axies, improve body parts, craft rooms and accessories. People can spend money on cosmetic items for the sake of status or progression in the game. Zirlin said the criticism of Axie Infinity in the past was fair, but now the system will have balance.

Now Zirlin said the free-to-play version of the game will help the company draw in more players. The game will provide three free non-NFT starter Axies to new players. Those players of Axie Infinity: Origin will be able to battle each other without spending money and learn how to play through gameplay tutorials. That is making Axie Infinity: Origin much more accessible, and Zirlin hopes that players will stick with it because it’s fun. That hopefully means that players won’t be playing just so they can make a quick buck by selling their Axies to players who join later.

“We wanted to provide a way for anyone to fall in love with the game,” said Zirlin. “Players experience the universe for free, without having to go down the crypto onboarding. And so our thesis is that Axie is beautiful, it’s fun. And not enough people know that because there’s a huge an entry barrier. So if we can front load the experience and make the blockchain onboarding something that happens post activation and post interest, then we’re going to be able to convert and bring a different type of audience into technology.”

The Axie Infinity: Origin inspiration

The inspiration for the new game came in part from realizing what was missing from the original Axie Infinity.

“We wanted to retain a lot of the spirit of what makes Axie classic, which is currently on the market, really fun,” Zirlin said. “But we wanted to upgrade the art, the animations — and we wanted to make it faster paced, a little bit more responsive.”

The original game had parallel turns. When you play a card in Origin, the Axie springs into action. The attacks happen one round at a time, and players can analyze the play style of their opponents and react to it. The play is turn-based, and it allows for more strategy and anticipation in the fighting.

Axie Infinity is an NFT game where players battle, collect, and trade digital pets called Axies. Through the alpha release of Origin, Sky Mavis’ goal is to create a battle system that is more fun, beautiful, and engaging and open the Axie ecosystem up to a broader audience, Zirlin said.

Players can expect to see the following changes to gameplay in the alpha version:

• Power-ups: Runes and charms are new power-ups introduced in Origin. They are equipped by players’ Axies and will provide various buffs. Runes give new passive powers to Axies and charms are wearables that enhance an Axie’s inherent abilities.
• Sequential turns: In Origin, Axies will now execute their attacks immediately as cards are played. Opposing trainers will take sequential turns using their cards versus choosing them simultaneously at the beginning of a round. Trainers will now be in constant action by either playing their cards or carefully observing their opponent’s moves.
• Card changes: Although most cards will carry over to Origin, they will now play differently as most cards have either an attack or defense value, instead of both. Additionally, new cards that relate to an Axie’s eyes and ears will increase the meta combinations significantly. Each Axie now has six cards associated with it instead of just four.
• Free starter Axies: Three non-NFT starter Axies will be provided to every player so that users can immediately start playing the game without any financial barrier to entry.

These elements make the game deeper, more fun, more skill based, and also more appealing to a mainstream audience, Zirlin said.

“We made it faster paced, which means that Axies execute their attacks immediately as cards are played,” he said. “This gives the game of more of a real time, lifelike dynamic, where Axies immediately sprang into action as soon as you play a card. We’ve also redone the art, the animations,and we’ve added in a totally new storyline and finally added power ups. So you can now insert runes into Axies and attach charms to Axie cards. So this basically allows for more customization, more depth, a lot more strategy and skill.”

Gameplay preview

I downloaded the game and it fired up very quickly. I started with three free Axies and had a choice of taking them into the adventure mode to learn how to play or going into the arena mode. I got through a few battles easily on my first try and then lost my creatures in a battle.

“We are constantly looking for ways to bring the fun of Axie Infinity to even more people. Through Origin, we are not only making the game easier to play by offering three free non-NFT starter Axies, but we are polishing the design, making gameplay more efficient, and introducing new mechanics to drive sustainability,” said Trung Nguyen, Sky Mavis CEO, in a statement. “During the early access release, our focus is on collecting player feedback and real gameplay data to be able to create the best experience possible before a full launch. We look forward to hearing players’ input and can’t wait to see our community grow while building a better, decentralized world together.”

There will be no SLP or AXS rewards available in Origin during Early Access. All progress made and resources collected in Early Access will be reset after the Early Access period ends. Axie Classic (Battles v2) will continue to run in parallel, with SLP and AXS rewards, until further notice. After an initial early access period, Sky Mavis plans to launch Origin on Android and iOS apps stores and will work towards a full launch that incorporates SLP rewards, NFT Runes / Charms, and have official Seasons.

One of the tasks ahead is to enable the web-based game to run as many smartphones as possible, Zirlin said. The backend team is working to make the game as accessible as possible.

The theft investigation

As for the theft, Zirlin said the company is working with law enforcement and the investigation is moving forward. The Sky Mavis team made the mistake of creating a backdoor to improve transaction flow in December and then it neglected to close the backdoor. Hackers found it and stole the money from the Ronin network bridge.

Some transfers into other cryptocurrencies are happening again with Binance but some things are still frozen. Players still can’t convert their AXS currency into Ethereum.

“It’s been a really tough time but the community is rallying,” Zirlin said. “We’re really seeing people rise to the occasion. We’re working super hard internally to resolve it. And I feel confident that we’re going to get to the resolution.”

The future of play to earn

The play-to-earn idea has moved from being something for hobbyists and early adopters and is now shifting to more mainstream players, rather than being limited to crypto traders, Zirlin said. The model could still use a lot of refinement and, frankly, games that are better than Axie Infinity. But once that quality arrives, developers like Zirlin believe the mainstream audience will follow.

“This release is really tailored toward a broad general audience that loves creature collection and battle games,” Zirlin said. “People think that there is a silver bullet to basically skip to mainstream adoption. But what everyone knows is that movements basically start with a revolutionary core and then spread outward towards a broader audience.”

The guilds are going through a transition where they are realizing they cannot just be focused on the relation between the scholar, who gets money to start playing, and the manager, who reaps a percentage from the scholar’s winnings. The guilds have to make sure that they’re adding other forms of value to the ecosystem, either by creating content or educating people or engaging in esports, Zirlin said.

“We’re seeing specialization within guilds,” he added.

In April, Sky Mavis hopes to talk more about its upcoming Land title, which will let players buy and sell virtual property. That experience will be more like a Stardew Valley meets Clash of Clans kind of experience, Zirlin said.