Axie Infinity (AXS) is a blockchain-based game on the Ethereum network created by Sky Mavis. The premise of the game revolves around creatures called Axies. Each Axie is a non-fungible token (NFT), and players need 3 to start their adventures. Axie Infinity allows players to collect, breed, raise, battle and trade these NFTs.
By playing the game you are able to earn smooth love potion (SLP) tokens as a reward for winning battles. The SLP token is an altcoin, which is an Ethereum-based cryptocurrency that users can buy, sell or trade for other cryptos.
How Does Staking Cryptocurrency Work?
Staking your crypto is an alternative method of providing security and effectiveness to the blockchain network. A user wishing to stake their crypto would put their assets on the platform, users are then rewarded with crypto in the form of an annual interest rate. These rewards come from the company's share of AXS, as they intend to release the total supply of the token over an extended period of time, in order to expand the community. By staking AXS, you are participating in the security and governance of the Axie Infinity network by validating smart contracts.
stake.axieinfinity.com: 170% Interest on AXS
The Mavis team launched the platform on Sept. 30. It is specifically designed to facilitate the staking of only AXS, with a current annual percentage rate (APR) return of 170%. Roughly 13 million AXS currently is being staked, equating to $1.7 billion.
What makes this staking mechanism so popular is that it is run on Axie Infinity’s side-chain — Ronin. Ronin is a layer-2 decentralized application (dApp) that facilitates transactions on the Ethereum network, allowing users to make 100 transactions a day with no fees. This means that there is no fee for depositing or withdrawing AXS on the platform. You are also able to collect your rewards every 24 hours allowing for short-term rewards.
How to Earn Interest on AXS
Earning interest on AXS is not much different than earning interest on other cryptocurrencies. When you’ve settled on where to buy your AXS, follow these easy steps to start passively earning AXS tokens.
Step 1: Open an online account: Coinbase.
The first step to earning interest on AXS is opening an account with an exchange of your preference. For this example, it’s best to use Coinbase, as the platform offers an easy-to-use interface and extra incentives over other platforms. Plus, assets on Coinbase are insured, adding a level of security to your investment. Make sure your password is strong and secure; this will minimize the chances of your account being compromised.
Step 2: Purchase cryptocurrency.
The next step is actually purchasing AXS using the exchange you signed up for. This can be done by simply adding a debit card of your choice and making a 1-time payment. An option for recurring purchases is available if users are looking to accumulate more AXS tokens. Once you have purchased your AXS you can now start the staking process.
Step 3: Bridge to Ronnin Network
In order to stake your AXS you must bridge it from the Ethereum network to the Ronnin network. To deposit AXS onto Ronnin, you will need to follow the simple steps on the official Axie Infinity website. This will require you to link your wallet and select the amount of AXS you wish to deposit.
Step 4: Earn Interest on Your Crypto
When the desired amount of AXS is in your Ronnin account, you are now able to begin staking. Stake.axieinifnity.com pays out interest on a daily basis, letting your digital assets compound to earn you high interest rates. Plus, there are no fees on withdrawals on the platform.
Other Platforms to Earn Interest on AXS
No other platforms currently allow you to stake your AXS for rewards. Other platforms in the future may facilitate AXS staking, but they most likely will not be as profitable or secure.
Risks of Earning Interest on Crypto
When dealing with cryptocurrencies, there are always going to be risks involved. One of the main things to be aware of is when staking, the platform now has control over your crypto. Users will not be able to trade that crypto while it is being staked, although AXS mitigates a lot of that risk when it comes to moving your AXS off the platform because there are no transaction fees.
Keep in mind that the APR rewards for AXS are inflated because of the recent launch of the platform. You can expect the APR to come down to a more realistic return in the future as more users begin to stake on the platform.
Is Earning Interest on Cryptocurrency Worth it?
When it comes to staking AXS, earning interest is beneficial for just about every circumstance. Although rewards may come down to a realistic APR, you are able to take out your AXS any time you want if you wish to sell or trade it as well as being able to claim daily rewards that you can re-stake or withdraw. Always make sure to do your own research before purchasing crypto, as they are very volatile assets.
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