The crypto crisis has already led to a drop of the AXS token from its November ATH of $165 to yesterday's $10. The news of the unlocking of early tokens has left investors in dismay.

AXS is the token of the popular online game Axie Infinity which players can use to earn money. Axie creatures can be bought and sold in the in-game exchange using NFTs. Last year, the game became the most popular in the crypto space and is the number 1 in terms of sales and player numbers.

As the interest of many players in the game was sparked by the opportunity to earn and invest, the downturn in the crypto industry has led to a significant drop in key metrics such as sales. Back in February, daily sales reached $427m with 641,000 deals, while in recent days sales have dropped below $2m with less than 100,000 deals.

Next week, 21.5 million tokens will be unlocked with a value of $225 million, or 8% of the total tokens that developers, advisers and early investors received in 2020. According to official figures, Axie Infinity sold 10.5 million tokens and raised $864,000 in a private token sale. In other words, investors paid 8 cents for each token, more than 100 times the current price.

Of the $225m, $20m will be available to investors, $25m to advisers and $57m to in-house developers. The remaining 11 million tokens will be used for future payments. 

About half of the funds ($102m) may be sold immediately on the unlock date, which would put considerable downward pressure on the price with a total capitalisation of only $878m. Anticipating the possible negative consequences, some investors are already selling off their AXS tokens, driving the price down to new lows.

StormGain Analytics Team

(a cryptocurrency trading, exchange and storage platform)