First, there was a price setback of around 10% for Axie Infinity on Tuesday. In an overall market that is becoming firmer again, however, AXS was also able to recover and has meanwhile tested $11 again. Then there was the next setback. Trading volume has plummeted in the last 24 hours. The drop of around 30% resulted in trading volume of around $140 million in 24 hours. Now the question of the further course development arises for Axie Infinity Holder and crypto investors. Can the psychologically important price mark of $10 hold or will AXS suffer another correction in the near future? Five reasons why you should (currently) stay away from Axie Infinity.
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Incidentally, in the longer term, the downtrend on Axie Infinity remains intact. The bulls tested this last, but the relevant price level could not be overcome.
Whether the dynamic development in the digital currency market or individual crypto projects, price forecasts and evaluations must be continuously adjusted. Because the challenges are immense. Nevertheless, the Axie team could implement changes and make the formerly popular P2E game the industry leader again. But why will Axie Infinity be trading much lower again soon?
1. Player numbers sharply declining – interest in P2E games correlates with course development
the Number of players in a play-2-earn game develop correspondingly with the course. Here one can certainly draw parallels to the stock market, where the profit development of a company is also primarily responsible for the medium-term development of the share price. While over 2.8 million players were still active monthly on Axie Infinity at the beginning of 2022, the number has dropped to around 400,000 in the past 30 days. The trend is sharply down, which poses a significant threat to Axie Infinity.
2. Repetitive gaming experience: This is not how to attract non-crypto users to the P2E game
Axie Infinity is not really known for an exciting gaming experience. Rather, there are repetitive tasks that players must complete in order to qualify for the rewards. The rewards concept initially attracted players to Axie Infinity. It just wasn’t enough for sustainable growth or even an expansion into the conventional gaming market. New features cannot change the basic concept, but only create partial incentives that make a comprehensive change in the ecosystem rather unlikely.
3. There is a risk of severe capital dilution: New unlock events are imminent
With a diluted market cap of approximately $2.9 billion, well above the current market cap of $1.25 billion, further capital dilution is likely in the future. The team still has a significant stake in Axie Infinity at a low cost price. Future unlock events will unlock these tokens. When the vesting period ends, the supply could increase and the price correct significantly. This has often been the case in the past.
4. Flippening completed: Decentraland now the most valuable Metaverse game
With a flipping, Decentraland became the most valuable metaverse game with P2E elements. Axie Infinity is no longer the top dog. This should also draw more interest in Decentraland.
5. Unique wallets, transactions & volumes plummet
Data from DappRadar reveal a sharp drop in wallets and transactions. About a year ago, the number of “Unique Active Wallets” was over 200,000, currently there are less than 15,000. While more than 500,000 transactions were processed in February 2022, recently it was only around a tenth. The volume even collapsed from over 50 million to around $1.5 million most recently.
Axie Infinity Alternative: This Web3 gaming ecosystem wants to make everything better
The challenges are significant at Axie Infinity. Now one could hope for a significant change in the play-2-earn game. Alternatively, however, there is the option of investing in new play-2-earn games that want to do better from the start. Meta Masters Guild (MEMAG) specifically aims to bring more entertainment into the play-2-earn segment and to cause sustainable player growth.
Ergo want Meta Masters Guild Build a diverse Web3 gaming ecosystem with a diversified approach, becoming a global industry leader. The high-growth target market is to be developed with a mobile-first approach. Exciting P2E games from well-known partners will be published soon. Early investors can currently still accumulate MEMAG tokens in advance and thus achieve massive book profits of almost 50% before the ICO.
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Author: Daniel Robrecht
After studying law and management, Daniel decided to work as a freelance author and has been writing qualitative publications on various specialist topics for around 10 years now. As an investor, he gained years of experience with stocks & cryptocurrencies. In addition to a long-term investment approach, Daniel is also passionate about short-term markets. Through targeted further training at international universities, he has acquired extensive knowledge about the capital markets, stocks, cryptocurrencies and decentralized finance. Daniel’s primary focus is on general market trends, exciting stocks, business news and the digital currency market. In his private life, too, there is never a day without the financial markets. As an author, Daniel writes for leading German-language publications in this field. Daniel publishes for Finanzen.net, among others, Business2Communityand FXStreet.de. Daniel on LinkedIn.
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