This year, a group of tokens split off from the larger list of digital currencies. Play to earn tokens established their own presence, headed by a handful of early movers. For a few months in 2021, the collection of play-to-earn tokens had a market value above $30B, though most were concentrated with the top tokens.
The processes and breakthroughs on cryptocurrency markets suggest play to earn tokens are here to stay and may become a staple for both players and investors.
Axie Infinity: What is the True Value of AXS
Axie Infinity has gone through a turbulent year, in which its community coalesced and proved the gameplay to be addictive and lucrative to draw in millions of players. The price of both AXS and Smooth Love Potion (SLP) was volatile, with both 10X growth and 50% drops typical for crypto assets.
How high can AXS go? At the end of 2020, AXS stood at just $0.53, only to reach an absolute record above $163. At the end of 2021, AXS held close to $100, held up on trading volumes around $200M. AXS is one of the tokens with exposure to Coinbase, and its highly responsive Binance pairings. If AXS volumes see some upside, the price may also move to regain some of the lost positions.
Additionally, SLP is at around $0.03, with previous peaks above $0.30. The reward token will be taken for staking in the coming year, to generate a new asset, RON. This may increase the scarcity of SLP and lift the prices from their currently weak position.
Decentraland (MANA): Will Digital Land Take Off?
MANA turned into the leading play to earn asset at the end of 2021, taking the spot of AXS with the highest market capitalization.
MANA took years to evolve, and has traded through the bear market from 2018 to 2021. The asset peaked above $5.11, and now stands at $3.33. Decentraland is on track to expand its adoption, with land plot purchases happening almost daily. Regular digital land purchases trade for about 3 ETH, with larger or exclusive plots potentially commanding higher prices.
Decentarland is one of the most mentioned projects in the past weeks. MANA is popular as a speculative token and mentioned in connection with NFT collections and digital land. In the short term, the token may revisit the $5 range. MANA is bound by its limited trading volumes at some points, as well as its large supply of 1.8B tokens. =
The Sandbox (SAND) Closer to Beta Release
The Sandbox (SAND) released a limited closed alpha version for owners of digital plots. The coming year may see the beta launch of one of the most popular projects in play to earn space.
SAND easily marked a record of $8.40 in 2021, and headed for a year-end price of $6.10. SAND is one of the more significant success stories, especially after starting the year around $0.04.
Next year, SAND may migrate to Polygon Network (MATIC), after positive feedback from the alpha version launch. Easier access may boost the drive to get SAND, especially if item creation gets opened to all players.
The Sandbox is among the most widely mentioned games on social media, but lags behind Axie Infinity and Decentraland. SAND may have an upside with the growth of social media mentions.
Meme Coins and Play to Earn
The past year saw a series of meme coins arise, partially inspired by Dogecoin (DOGE). For a few months, the tokens were relying mostly on hype, as well as their potential for significant price gains in a short time.
The breakthrough came from Shiba Inu (SHIB), which outperformed older crypto projects. Meme coins however quickly moved beyond the phase of making jokes, and placed their tokens as tools for decentralized finance.
Shiba Inu then expanded its model, adding Shiba Games for its future play to earn activity. In the coming year, another meme token, Floki Inu (FLOKI) also expects to launch its game.
Meme tokens are unpredictable, but their best feature is the possibility to bounce from lows and pull a 10X appreciation in a short time. SHIB is down from a peak at $0.00008 down to $0.00003, after sliding for a few months. The asset’s goal is to invite its buyers to hold and use SHIB within the ecosystem. Together with regular token burns, SHIB has the goal of moving closer to $0.01.
FLOKI had a similar trajectory since May 2021, sliding from $0.00003 down to $0.00001. At this point, FLOKI remains risky, but moving up is also a close possibility, potentially driven by the Vikings game announcement.
Play to earn tokens are going through a price discovery stage. At the end of the year, the total valuation of those assets hovered around $29B, erasing about $2B in notional value within days.
The value of some tokens also hinges on the price action of Ethereum (ETH). Prices above $4,000 spill over into tokens and boost the positions of some play to earn assets. The usage and fees for play to earn tokens also depend on gas fees on the Ethereum network, either helping or hindering game projects.
Game launches are not guaranteed for play to earn startups. Game reviews are not investment advice. Cryptocurrency trading is inherently risky, and rapidly rising assets may erase most of their value. Avoid investing funds you cannot afford to lose.