SLP, the reward token for popular crypto game Axie Infinity, has risen by 58 percent overnight and nearly 300 percent in the previous week to $0.03787. SLP’s overnight gains coincide with a 36 percent increase in the price of the game’s governance token, AXS, in the previous week.
Following the official introduction of Axie’s ‘Season 20’ update, which includes significant changes to the play-to-earn title’s in-game economy, both currencies have surged in value.
So, what is Axie Infinity and what role does SLP play?
Axie Infinity is a Pokémon/Tamagotchi-style game in which players acquire, breed, and combat monster NFTs for prizes.
Battles may be used to obtain ‘Smooth Love Potion’ (SLP) tokens once players have built a team of Axies. SLP tokens can be used to unlock additional features in the game, such as the ability to breed new Axies.
How does Axie Infinity’s Season 20 update alter things?
The latest Axie upgrade focuses on halving the daily supply of SLP tokens by 56%. They can no longer be earned by completing daily quests or playing in adventure mode.
The Sky Mavis team noted in a blog post: “In theory, the daily quest was a fantastic way to encourage players to play every day, but it’s now become an SLP mass emission tool. We can minimize issue by roughly 45 million SLP each day by eliminating the daily search”.
The new SLP cap restrictions are designed to increase token scarcity, which creators believe is vital to avoid “complete and permanent economic collapse”.
The danger of a meltdown in the game’s former economy was due to the token’s exceptionally high inflation, “with about 4x more SLP being made (provided) per day than burnt (demanded) through breeding,” according to the game’s prior economy. Sky Mavis expects that the latest update would restore the game’s economy, which has been in decline in recent months, with the floor price for Axie NFTs plummeting from several hundred dollars to around $50.
Onboarding new players is also a key aspect of Season 20. The organization has set aside a $6 million prize pool, and the top 300,000 participants in the next season will get up to 117,676 AXS tokens.
Another good news for SLP came yesterday: crypto exchange Binance adopted SLP/BNB as a trading pair, allowing traders to directly swap BNB for SLP on the platform.