One of the commonest subjects of dialog inside the Axie Infinity ecosystem just lately is across the Smooth Love Potion (SLP). We’ve been amazed by the extent of considerate enter you all have shared with us, and we additionally empathize with a lot of your considerations. That stated, we wished to write down to you all within the new yr with the hope of sharing some historical past, some statistics, and a few of our present pondering as we additional develop the financial fashions round SLP.
We launched SLP in December 2019 as a utility token which enabled Axie breeding. While its core function was humble, the group’s response to SLP’s launch made it clear quite early on that something very special in game economy history was occurring. These evolutions in SLP’s use in tandem with the explosive growth of 2021, has pushed each unbelievable development within the liquidity in addition to some elementary inflation within the token over time.
To put issues in perspective, the common quantity of SLP burned per day has grown over 500x (50,000%) via 2021! However, that should be contrasted with breakneck SLP creation, which traditionally has constantly outpaced its use, and has moreover grown over 160x (16,000%) during the last 12 months. Today’s knowledge exhibits a rising chasm between SLP minted vs. SLP burned (Figure 1). This inflation within the token just isn’t sustainable.
Figure 1: Daily SLP burn, mint and web emissions
The major complexity in financial balancing of SLP comes from the problem in predicting future participant development alongside timing additional releases of merchandise inside our gaming ecosystem. As hopefully you all know, we’re engaged on a lot of new gaming experiences, together with the subsequent technology of our battles expertise (Origins) and a new land-based gaming experience (Project K). Each of those video games will embrace a lot of new options that may have an effect on the financial system steadiness. We’ve additionally invested vital effort and time over the previous yr into scaling our programs to accommodate the expansion and construct out the foundational blockchain parts wanted for our ecosystem (e.g. Ronin, Katana, Staking). All of those efforts usually have come on the sacrifice of bettering our current gameplay programs. However, we need to reassure you that we wish to prioritize experimenting with short-term approaches in the direction of managing SLP’s inflation within the new yr.
Please know that we’re listening to all of you. You all have given us a lot of concepts to contemplate within the quick time period whereas the Sky Mavis workforce has give you some as properly. In quick, SLP economics evolve with modifications to its provide and demand. We wished to overview just a few of the extra standard shorter time period provide / demand concepts rising inside the group:
- Iteratively steadiness all in-game SLP rewards: The present alpha gaming expertise continues to be refined on a number of fronts whereas participant exercise has advanced in stunning methods. As such, with the continual balancing course of, we could must manually cut back SLP emission charges for day by day quests, PvP, and PvE. Over the longer run, we’re hoping this may be adjusted extra dynamically.
- Change ratios of in-game incentives: SLP just isn’t the one token inside our ecosystem. In truth, our long run imaginative and prescient is for a extra equitable distribution of AXS rewards via gameplay. We need prime gamers to realize affect inside our group. We are evaluating methods to do that with out inadvertently creating inflation issues for AXS as properly. Unfortunately, we presently don’t have the performance to distribute AXS as a battle reward and so would want to spin off engineering effort from different tasks to work on this. In the meantime, we’re contemplating growing AXS in Leaderboard rewards and decreasing SLP rewards to excessive MMR gamers as one possibility.
- Reduce SLP produced via non-skilled / automated / botting methods: We obtained a lot of suggestions from the group centered round decreasing SLP rewards for components of the sport most weak to automation or botting methods. Specifically, SLP received throughout PvE battles. This may happen in just a few methods, together with general reductions in PvE emissions, or by updating the Daily Quest requirement splits to be extra Arena centered over Adventure to make it simpler for actual gamers to earn. This sadly isn’t a exact science, and it’s doubtless that some actual individuals will earn much less SLP due to this alteration. Another concept can be to require vitality to earn SLP in PVE. This is presently not the case in that gamers can nonetheless hit the 50 SLP cap after they’re out of vitality.
- Axie releasing / burning / consumption: This is a really vital function that we have now to be very cautious round, and takes vital engineering effort to construct. However, we plan on releasing some smaller exams this yr to have the ability to validate the mechanic iteratively. Since the first utility of SLP is to create new Axies, having this burning mechanism for Axies would improve demand for SLP (and AXS).
Needless to say, there are lots of elements we have now to contemplate for every of those concepts, so finally we can’t make any guarantees as to which can be carried out. However, know that we’re spending a variety of effort and time throughout our groups determining how we will make optimistic changes. It’s additionally value noting that this above listing doesn’t embrace all the long run concepts you’ve shared, together with introducing Axie cosmetics and tournaments.
We’d like to listen to from you. Which of those approaches do you want finest and why? Are there others not talked about right here you assume we must always think about? Feel free to share your ideas on Twitter utilizing the #AxieEconBalance hashtag.
As a remaining be aware, we need to communicate a bit concerning the MMR reset that occurred earlier right now for the Season 19 Off-season. First, we need to say that we initially deliberate to announce it with this weblog publish and made a mistake to reset it beforehand. We will study from that misstep.
We had appeared into doing extra granular MMR reset changes for various ranges of MMR, but it surely wasn’t possible given quite a few elements and trade-offs (particularly technical limitations). That stated, this MMR reset will assist guarantee that SLP provide and demand are nearer to steadiness. We noticed that over time, MMR inflation was occurring because the player-base grew, that means increasingly SLP was being produced every offseason. In addition, off-seasons have been growing in time and size, particularly now that we want to launch balancing updates in the midst of low season fairly than originally of the season.
We noticed that common SLP per PVP battle elevated by ~40% over the course of Season 19 (from Day 1 to final day of the season). We consider that resetting low season MMR reduces pointless provide, and finally results in a extra balanced SLP financial system.
We need to reiterate that we care deeply concerning the financial system and the Axie Infinity group. We spend appreciable time pondering deeply concerning the tradeoffs between quick and long run financial balancing. While we’ll proceed to lean strongly in the direction of the long run development and sustainability of our ecosystem, we wish you to know that we plan to shift a few of our focus in the direction of sure short-term points which have emerged. We understand it’s necessary.