Axie Infinity's Wild Ride: How a Pet-Battler Became a $3 Billion Phenomenon

On 6 August 2021, players of a cartoon creature-battler sent about $17.5 million to its treasury in a single day. The game was Axie Infinity, its creatures were round, big-eyed blobs called Axies, and it had been made by a few dozen people in Ho Chi Minh City. For a few months that year, it was one of the most talked-about games on the planet, even among people who never usually talked about games.

This is the story of how it got there. It is also, as you'll see in our companion pieces on the token crash and the Ronin bridge hack, the opening chapter of a much rougher tale.

A side project born from CryptoKitties

Axie started as a hobby. Development began in 2017, led by Nguyen Thanh Trung (known in the West as Trung Nguyen), with co-founders Tu Doan, Aleksander Larsen, Jeffrey Zirlin and Andy Ho. Trung had spent his own money on CryptoKitties, the Ethereum pet-breeding craze of late 2017, and liked the idea of owning digital creatures. What he didn't like was that there wasn't much of a game around them.

So the team built one. Axie took the collect-and-breed loop of CryptoKitties and bolted on battles in the spirit of Pokémon and Neopets. The first version went live in March 2018, a battle system followed in October 2018, and a real-time card battle mode entered development in March 2019, reaching alpha in December 2019.

The studio behind it was called Sky Mavis. For its first few years it was small, scrappy and mostly ignored outside crypto circles. In its first two to three years the project brought in roughly $21 million, a respectable sum for an indie, but nothing that hinted at what was coming.

How the game worked, and why it was expensive

To play Axie, you needed a team of three Axies, and each Axie was an NFT: a unique token on a blockchain that you could buy, sell or breed. That was the hook and the barrier. In February 2020, Sky Mavis estimated a new player needed about $400 just to start. By August 2020, the cheapest Axie on the market cost about $307.

Winning battles and completing tasks earned a token called Smooth Love Potion (SLP), which players spent to breed new Axies. Breeding also cost the game's governance token, AXS. Every trade on the marketplace paid Sky Mavis a 4.25% fee. The design meant the game made money whenever players traded, and players made money whenever someone else wanted to join.

That second part is what turned Axie into a phenomenon. If new players kept arriving, the tokens you earned and the Axies you bred kept their value. The question nobody could answer in 2021 was what would happen if they stopped.

The pandemic, the Philippines and the scholarship boom

Axie's popularity in the Philippines began around August 2020, in the middle of COVID-19 lockdowns. People stuck at home, many out of work, found that a phone game could pay. By June 2021, some Filipino players were treating it as their main source of income.

Because a starting team was costly, a system of "scholarships" grew up: owners lent their Axies to players, called scholars, in return for a cut of the earnings, with commissions reported as high as 75%. Whole guilds formed to manage thousands of scholars. Sky Mavis said that more than a quarter of its players were unbanked and half had never used cryptocurrency before.

The Ronin switch that lit the fuse

The real acceleration came from a technical change. Ethereum transaction fees in 2021 were punishing, sometimes costing more than the items being traded. In February 2021, Sky Mavis launched the Ronin wallet, and in April 2021 the game moved to Ronin, its own Ethereum-linked sidechain built just for Axie. Fees fell to almost nothing and transactions got fast.

The effect was immediate. New players poured in, breeding exploded, and so did SLP issuance. The average Axie NFT sold for $494.15 in July 2021, its peak. Monthly NFT sales passed $848 million in August 2021.

By the numbers

• 2.7 million: peak average daily players.
• $1.3 billion: revenue to the Axie treasury in 2021.
• $17.5 million: the best single day, 6 August 2021.
• $214 million: weekly NFT trading volume in November 2021.
• $152 million: Series B round in October 2021, at a $3 billion valuation.
• $2.3 million: a single plot of virtual land, sold on 25 November 2021, a record for the game.

Silicon Valley arrives

On 5 October 2021, Sky Mavis announced a $152 million Series B led by Andreessen Horowitz, with Accel and Paradigm, valuing the company at $3 billion. At that point the game had generated about $2.3 billion in total sales volume since 2018 and was nearing 2 million daily active users. The money was earmarked for opening Ronin to outside developers, growing the team and scaling infrastructure. The day before the announcement, the AXS token had hit a record high after Sky Mavis said it would distribute more than $60 million in tokens to early players and launch staking, a reminder of how closely the game's fortunes were now tied to a market price.

For a while, Axie was the poster child for a new genre the industry called play-to-earn, or P2E. Big publishers started talking about blockchain on earnings calls. Venture capital flooded into copycats. Trung Nguyen was named one of CoinDesk's most influential people of 2021.

The cracks were there from the start

Even at the peak, critics warned that the economy only worked while new money kept flowing in. By September 2021, Filipino players' earnings had already fallen below the national minimum wage. Profits to the treasury dropped sharply in early December 2021 and never recovered. By April 2022, the treasury was taking in just over $40,000 a day, against $17.5 million on its best day eight months earlier. Daily players went from about 2.5 million in November 2021 to 1.2 million by April 2022, and a Reuters report in April 2023 put the average at around 250,000.

Then, in March 2022, came the Ronin hack, one of the largest thefts in crypto history. Sky Mavis reimbursed affected users, but the dream of an economy that paid everyone had already broken. We cover why in detail in our piece on the SLP crash.

WGC's take

Axie Infinity deserves a place in gaming history, but not for the reason its 2021 boosters claimed. It proved that millions of people would play a blockchain game, and that a tiny studio in Vietnam could build global infrastructure around one. It also proved, painfully, that a game whose main attraction is income behaves less like a game and more like a market. When the market turned, the players who could least afford it were hit hardest.

Sky Mavis has since stepped away from "play-to-earn" in its messaging and moved towards games meant to be fun first. Whether that works is still an open question.

What to watch

Sky Mavis's next big bet is Atia's Legacy, an Axie MMO confirmed for PC, Android and iOS. Its first alpha ran from 25 September to 2 October 2025, and as of the studio's update on 6 November 2026, the team said a Steam page was the next milestone, with the next playtest opening at the same time. There is no release date yet. If it lands as a good game first, it could be the second act Axie needs. If not, the 2021 boom will remain the series' defining chapter.