Direct from the desk of Dane Williams.
Earlier in the week when I asked why CoinGecko’s gaming coin list looked weird, of course I expected to see tokens related to actual games like Axie Infinity up there.
With Axie’s market cap falling off a cliff after the house of cards that the game’s completely unsustainable tokenomics were built on came crashing down, it’s not surprising they aren’t there.
But what about all of those people we used to constantly read about who had their lives changed by Axie?
Well today I stumbled upon an intriguing article by Reuters that shed light on the tumultuous journey of Gian Carlo McGlay and some of his fellow Axie disciples.
The piece vividly recounted their experiences, narrating the rise and fall of their play to earn (P2E) aspirations.
Yet as I delved into these personal accounts, I couldn't help but question why the focus remained on these emotional tales.
Shouldn’t it have been on the larger issue of sustainability and responsible decision-making?
Well I think so and as such, want to examine the overlooked realities of P2E disasters like Axie Infinity.
Let’s dive right in.
The rise and fall of P2E dreams
Axie Infinity, the extremely expensive P2E game touted for its blend of entertainment and cryptocurrency earnings, seemed like a beacon of promise for many in the developing world.
Its boom allowed players like the interviewed Gian Carlo McGlay to become "managers," helping those who couldn't afford in-game characters (Axies) participate in the P2E ecosystem.
The potential to earn through gameplay, particularly the coveted "Smooth Love Potion" (SLP) tokens, was alluring, especially for scholars – the players who rented these Axies from manager’s like Gian.
At its zenith, the game's framework allowed some managers to rake in substantial daily profits, while scholars enjoyed the financial stability of having a steady job.
Well, until they didn’t.
Amid the tales of heartache and shattered dreams highlighted by Reuters, it was actually one quote that really struck a chord with me.
Gian Carlo McGlay's admission that "Nothing was left. My Axie Infinity assets became worthless so I just gave them away."
Umm, what?
Doesn’t this sort of incompetency actually have nothing to do with Axie’s tokenomics and everything to do with his complete and total mismanagement of his business?
These personal sob stories are grabbing all of our attention via the mainstream media, however, they mask a critical question that needs answering.
Why did these sob stories become the focal point, overshadowing the more pressing need to analyse the sustainability – or lack thereof – of these ventures?
The missing emphasis on sustainability
Intriguingly, those Reuters' interviews indicated that discussions about P2E token sustainability appeared conspicuously absent during Axie Infinity's heyday.
Something that you’d think a small business manager in any other field would be all over.
The managers, who effectively operated small businesses tethered to the game's success, seemed to neglect the importance of long-term viability.
It left me pondering why these stakeholders didn't champion the cause of sustainability when the tides were favourable and potential earnings were at their peak.
The quote from Christopher Cruz, a Filipino businessman and cryptocurrency trader, was particularly telling.
"I felt like a drug lord. I could buy everything I wanted – every item inside the mall was never too expensive – during that time."
Seriously?
Even drug lords undertake risk management in their business.
I’m simply flabbergasted at how incompetent those running businesses around the game, a game that is still operating today mind you, were.
As I reflect on the Axie Infinity boom/bust cycle, it's clear that a shift in narrative is needed.
While P2E sob stories are undeniably powerful mass media click drivers, they should serve as catalysts for deeper analysis rather than simply recounting tales of loss.
The real question lies in dissecting why sustainability was often an afterthought and how players – both managers and scholars – could have approached the situation differently.
The lessons learned from these interviews, including the quote from Gian Carlo about simply giving away assets after they turned worthless, underscore the need for a more comprehensive approach.
If you’re running a business, then run your operation like a business.
Rather than chasing unsustainable gains, the opportunity to reinvest those profits into stable assets, such as blue-chip holdings like Bitcoin or even stablecoins offering attractive yet sustainable APRs, would have paved a more secure financial path.
Best of probabilities to you.