Good morning, cryptofam! $BTC is now well over $50k following statements from the Federal Reserve chair Jerome Powell that the US had no intention of banning Bitcoin the way China did. You would think that in a purported democracy like the United States, this would go without saying, but some proposed amendments to the tax code have recently cast doubt on exactly how “free” crypto people in the US actually are.
The rest of the market is happily green, with both Bitcoin and Ethereum marking double-digit growth over the last 7 days. Of course, the big winners are $AXS (85%) and, annoyingly, $SHIB (300%+). In the case of $AXS, the Axie Infinity team dropped three consecutive bombshells to nearly double its price this October. Over the last 7 days, they’ve distributed $100M worth of $AXS for free to the earliest members of the community, they’ve launched the $AXS Staking Dashboard, and as an encore, they announced a $152M investment from the likes of Andreessen Horowitz. Any one of these things would have been enough to garner attention, but to do all three simultaneously is truly impressive. Meanwhile, what did $SHIB do? Nothing, Elon Musk tweeted a dog picture.
The new investment revalues SkyMavis at just shy of $3B. This is impressive by any metric you choose to use, but is all the more fascinating when you consider they’re now about half the value of Square Enix (makers of Final Fantasy) or Ubisoft (Assassin’s Creed). And they did it with a single game that isn’t even in beta yet. Additionally, the Axie NFT marketplace generated over $1B in revenue over the last quarter, which places them ahead of the total sales volume of Take Two Interactive (NBA2K, Grand Theft Auto) and in the same ballpark as the entirety of Electronic Arts (FIFA, Battlefield, Apex Legends). Also, consider that the best-selling single game of all time is Marvel’s Spider-man, which sold 20 million units at $40 a pop in 2019. Axie Infinity handily generated $200M MORE than that in a single quarter.
How is this all possible? Primarily, it’s because SkyMavis isn’t the entity that’s earning all that revenue we were talking about. 96% of it is going back to the players, and it turns out that if players can earn money from selling your game, they will sell the crap out of your game. For this reason, I don’t expect a lot of video game publishers from the traditional world to be able to really wrap their heads around this concept for a while yet. I also don’t expect a lot of really strong P2E games really threaten Axie’s dominant lead in the near term, because this monster investment round has sucked up all the money in the space, and few investors would want to bet against a16z and Accel Partners. There will be lots of small raises for sure, in the Seed to Series A range, but it’ll be some time before we see another 9-digit round from a different P2E game.
The Cryptopop Art Guild (CPAG) has officially ended its scholarship application process. We have a total of 196 artist scholars now, and next week we can begin our mentoring program in earnest. Our first mentor will be CPAG investor Caroline Dy, one of the earliest NFT artists in the Philippines and a veteran of the local game development industry. She’s on both Twitter and Instagram as @drawwriteplay. All of CPAG’s mentors are also investors in the guild, so we’re incentivized to make sure our artists are able to perform to the peak of their abilities.
See you all next week, cryptofam, and have a great weekend!