Axie Infinity Backer Delphi Digital Dumps all of its $AXS Holdings
One of the early backers of Axie Infinity, Delphi Digital had offloaded its entire $AXS holdings 3 days ago. The move came at a time when the P2E game is struggling to sustain its in-game economy.
Delphi Digital dumped its $AXS holdings over the weekend
In a rather shocking discovery, Axie Infinity backer Delphi Digital had offloaded its entire $AXS (Axie Infinity Shards) holdings over the weekend. Steven Zheng, Research Director at The Block found out about these transactions through the Nansen analytics platform.
According to Etherscan, Delphi Digital got rid of 600k $AXS by depositing these tokens to Coinbase 3 days ago. The move effectively emptied the wallet in 2 transactions. Zheng added that at the peak, the entire holdings of the wallet worthed $95 million in value.
To those who don't know, Delphi Digital was one of the early backers of Axie Infinity in 2020. More importantly, the research firm helped design the $AXS token in the first place. Even though 600k tokens only made up a small portion of the total supply of 270 million $AXS, the move is not likely to be seen as a bullish sign. As of writing, the firm has not commented anything on the matter.
Concerns about Axie Infinity's play-to-earn model
Since the start of the year, both digital tokens in the Axie Infinity ecosystem have seen a huge drop in prices. For $AXS, the price dropped more than 83% on a year-to-date (YTD) basis. Whereas for the utility token of the game, $SLP (Small Love Potion) the price dropped more than 85% YTD.
Given that, many users attributed the drop in prices to the unsustainable play-to-earn (P2E) model in Axie Infinity. At the moment, $AXS only serves as the governance token and utility token for breeding Axies in the game. For $SLP, the only use case is to pay for Axies' breeding cost.
Lately, billionaire Mark Cuban gave some suggestions on how Axie could revamp its P2E economy. But seeing the move by Delphi Digital, it seems that the $AXS token creator itself has already lost conviction in the project.