If You'd Bought $1,000 Worth of Axie Infinity (AXS) at Launch, Here's How Much You'd Have Today

Axie Infinity has just brought in over $100 million in revenue in 30 days. Why is the game so popular?

If you'd bought $1,000 worth of Axie Infinity Shards (AXS) when the token launched in November 2020, you'd have received 6,854 AXS. As I write this, (July 23), Axie has just hit a new all-time high. Using CoinMarketCap data, at the current price of $31.35, those AXS would now be worth $214,873 -- an increase of over 21,000%.

To put that in perspective, just two months ago, 1 AXS cost $3.38. The price peaked at $29.13 on July 15 and then dipped and closed the day at $23.96. But it's been back on a tear in the last few days.

So what is Axie Infinity and what makes this cryptocurrency worth a deeper look?

Axie Infinity basics

• What it does: Axie Infinity is a play-to-earn cryptocurrency game where players can earn tokens and breed cute collectible animals called Axies.
• Management team: Axie Infinity was developed by a company called Sky Mavis, but it aims to evolve into a community-owned organization over time. It has 40 full-time team members, and the leaders have backgrounds in gaming and technology.
• Date launched: AXS started trading in November 2020, but Axie Infinity was founded in early 2018.
• Market cap: $1.9 billion (CoinMarketCap, July 23).
• Noteworthy backers: Mark Cuban, Blocktower Capital, Konvoy Ventures, and Libertus.
• Availability: Unfortunately AXS is not available from major U.S. cryptocurrency exchanges. Be aware there are additional risks if you use an exchange that is not authorized in the U.S. -- your account could be frozen and leave you unable to access your assets.

Why is everybody talking about Axie?

As we've seen, Axie Infinity has made two big price jumps at a time when many other digital currencies are stagnating or trending downwards.

Here are two of the main reasons Axie has grown so much:

1. It is a play-to-earn crypto game

Play-to-earn is a relatively new gaming concept. Players earn two different in-game tokens -- Axie Infinity Shards (AXS) and Smooth Love Potions (SLP) -- which they can either spend in Axie land (aka Lunacia) or trade on decentralized exchanges for real-world money.

The Axies themselves are non-fungible tokens (NFTs). These player-owned digital collectibles can be bred, bought, and sold. The cheapest Axie on sale right now costs around $200. And the most expensive Axie ever sold went for 300 ETH (around $620,000 today). To play the game, you'll need to buy three Axies using Ethereum (ETH). You'll also need to have a good chunk of time you can dedicate to world-building.

2. It's brought in eye-watering revenue

Axie's revenue has shot off the charts in recent months. Token Terminal data showed it's the top-earning crypto app right now by a long way. It brought in $101.7 million in the past 30 days. To put that in context, the second-highest earner was PancakeSwap with $10.9 million.

That's impressive. But bear in mind that cryptocurrencies aren't stocks. When you buy a stock, you own part of a company and you might get revenue in the form of dividends. Owning cryptocurrencies doesn't work that way -- you own a coin, not a share of the business.

You might, however, be able to profit if the prices of AXS or SLP continue to rise. Or if you participate in the game, as Axie shares 95% of its revenue with players. Plus, you can sell the Axies you breed in the game and also buy and sell land.

As we touched on above, players profit by earning tokens. In developing countries, some Axie players have been able to use their Axie earnings to keep food on the table during the pandemic. Some have even quit their jobs to dedicate themselves to Axie full time.

Lots of coins look good in hindsight

As an investor, it's too easy to play the what-if-I'd-bought-XYZ game. If you'd bought Amazon stock or Bitcoin at the start, you could be a millionaire today. But the trick of investing is looking forward to identify the trends that might profit in the long term.

Crypto gaming -- like most of the cryptocurrency industry -- still has a lot of hurdles to overcome, particularly in terms of scalability. It is an interesting space, and there are sure to be other gaming coins that snatch the headlines in the future. But, as an individual investor, you need to be plugged into that world if you want to pick the winners. You might also weigh up the benefits of investing in crypto games vs. gaming company stocks.

In terms of Axie Infinity, understanding crypto gaming would help you decide if the coin's value can still increase. Copycats have already started to spring up, though it's hard to see how they could replicate Axie's success quickly. With over 250,000 daily users, Axie already has quite a head start.

Ultimately, it isn't a great idea to buy Axie right now because the price has already increased by 21,000%. If you decide to buy, it should be because you think it can outperform other investment opportunities in the long term.