When the NFT cryptocurrency-collectibles exploded in popularity in early 2021, they drew the interest of a large number of millennials, helping the NFT craze become mainstream. Seeing an opportunity opening up, several blockchain-based gaming companies began working to occupy the new market. The Axie Infinity game, by indie studio Sky Mavis, was one of them. The monster-battling game, inspired by Nintendo’s Pokemon series, defied the recent crypto market crash to register a stupendous rise this month. The company claims it has more than 350,000 daily active users.

The game, available on PC, Mac, and iOS runs on the Ethereum blockchain with help from a sidechain called Ronin. It requires an upfront investment. However, the upside is that its play-to-earn approach rewards successful players in crypto tokens that can be exchanged for money. Also, players get to own Axie NFTs (non-fungible tokens); they can even resell them. The gaming company earns revenue by charging a 4.25 percent fee when players buy or sell Axie NFTs in its marketplace and by collecting fees for creating and breeding cute monsters called Axies.

In June this year, the Axie Infinity Shards (AXS) token was valued at under $5 (roughly Rs. 371). But it is currently trading in the $35 to $45 range (roughly Rs. 2,600 to Rs. 3,350), according to Coin Rivet, a dedicated digital currency news website. The report said the token doubled its native coin market cap within three days.

The explosive growth has come after Sky Mavis raised $7.5 million (roughly Rs. 55.7 crores) in Series A funding. Mark Cuban, the American billionaire entrepreneur and owner of the Dallas Mavericks NBA team who has also previously invested in cryptocurrencies including Bitcoin, Ether, and Dogecoin, is one of the investors.

However, Axie’s developers attribute the spike to their switch to using Ronin for faster transactions and reducing the gas prices – the cost necessary to perform a transaction on the network – to a negligible level.

AXS tokens allow users to participate in key votes in the Axie universe. This motivates users to hold on to their tokens, the developers say.

Interested in cryptocurrency? We discuss all things crypto with WazirX CEO Nischal Shetty and WeekendInvesting founder Alok Jain on Orbital, the Gadgets 360 podcast. Orbital is available on Apple Podcasts, Google Podcasts, Spotify, Amazon Music and wherever you get your podcasts.