Filipino players ditch crypto game – Taipei Times

• By Mariejo Ramos / Thomson Reuters Foundation, MANILA

At the height of the cryptocurrency COVID-19 pandemic boom, migrant worker Gian Carlo McGlay thought he had found a way to get past the lockdowns and provide income for dozens of unemployed people from his hometown in the Philippines.

However, McGlay's dreams of leading a team of "play to win" cryptocurrency gamers focused on the Axie Infinity game quickly fell apart when cryptocurrency prices plummeted, leaving the 32-year-old with losses of 1 million Philippine pesos (US$18,031). .

“There was nothing left. My Axie Infinity assets became worthless so I just gave them away,” McGlay said.

Axie Infinity, one of a new generation of blockchain-based online games that combine entertainment with financial speculation, also attracted investors who saw it as a way to introduce more people to cryptocurrencies.

Axie players can earn cryptocurrency by cashing in the tokens they earn in-game, called a soft love potion (SLP). For a while, it was a lucrative business.

McGlay's “scholars”—a term used for players who can't afford to buy the game's characters themselves and instead rent them out to so-called managers in exchange for a portion of their earnings—initially earned between $5,000 and 10,000 pesos per week.

Unlike other Axie managers, McGlay, who worked as a fisherman in Alaska before the pandemic, said he made no profit from the venture and let his interns keep all of his profits.

At its peak, Axie Infinity attracted 2.7 million daily active users, but those numbers have plummeted to around 250,000, according to Cryptogambling.tv, a website focused on cryptocurrency gaming.

Half of the game's players came from the Philippines and many others from developing countries such as Brazil, Indonesia, Peru and Venezuela.

Yield Guild Games (YGG), a group that invests in non-fungible token (NFT) games, said it has "prioritized scholarship awards in emerging economies where job opportunities are lacking and government relief has been limited" during the pandemic.

Many managers like McGlay faced heavy losses as the value of the game's SLP tokens fell 99 percent from its peak in February last year, reflecting a collapse in the price of cryptocurrencies.

Axie Infinity took another hit the following month, when hackers stole around $615 million worth of cryptocurrency from a blockchain network that allows users to transfer cryptocurrency in and out of the game.

While some Axie managers say their motives were philanthropic, other small investors were motivated by potential profit.

Christopher Cruz, 36, a Filipino businessman and cryptocurrency trader who used to manage 200 Axie fellows, said he made up to 600,000 pesos per game day by taking a 60 percent cut of his players' income.

“I felt like a drug lord,” Cruz said. "I was able to buy everything I wanted, every item inside the mall was never too expensive, during that time."

Its scholars, who were mostly high school students and seasonal workers from poor provinces, earned a daily income of 450 pesos, just below the 470-peso minimum wage in regions outside the capital, Manila.

A Filipino doctor, who asked not to be named, said it was "extremely easy" to recruit players during the pandemic and that her earnings as a manager were similar to her regular job income.

The SLP tokens were worth 3 pesos each when McGlay, Cruz, and the doctor joined the game. The value of the token peaked at 20 pesos, before falling steadily in late 2021. It now sits at around 0.16 pesos.

"It's not worth it anymore. The gameplay also became more difficult,” Cruz said, adding that it was now difficult to earn 50 SLP per day, up from 150 at his peak.

Losing their new source of income, legions of academics left the game and took temporary jobs as delivery drivers or online clothing sellers or went into education full-time.

“Gamers who were solely motivated by the financial rewards of the game have now moved on to other things,” YGG Philippines manager Luis Buenaventura said.

YGG continues to rent out Axie's NFT characters to interested players, "but it's not as necessary as it once was since all those NFTs are really affordable now," he said.

Axie's dizzying ups and downs should serve as a warning sign to potential investors in the volatile world of cryptocurrency, said Elaine Tinio, a marketing professional in Manila who used to gamble up to four hours a day to boost her income.

Excited by her initial earnings, she spent more and more money on Axie characters before a sharp drop in the value of the game's SLP token left her facing a loss of 200,000 pesos, equivalent to about five months of her salary.

“Greed got a hold of us,” he said.