Axie Infinity's trading volume 131x Year-to-Date, signaling the explosive growth in its popularity

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CoinGecko

15 Jul, 2021, 11:00 GMT

SINGAPORE, July 15, 2021 /PRNewswire/ -- CoinGecko, the world's leading independent cryptocurrency aggregator, has just released its Q2 2021 Report. In their analysis of the market, CoinGecko observed that even though Axie Infinity has been on the market for more than three years, its popularity held off until the Q2 2021. In May, players could migrate their Axies and trade freely on Axie Infinity's Ronin-based marketplace. Combined with a surge in the media's attention on its play-to-earn elements, Axie Infinity saw a 131x increase in just six months.

Other Highlights

  • Corresponding to volume increase, Axie Infinity saw its revenue grow 118x in the same time frame

Axie Infinity generates revenue via breeding and trading fees. Breeding an Axie requires 4 AXS, all of which are sent to the protocol's treasury. Meanwhile, each time an asset is sold on the marketplace, Axie Infinity will receive 4.25% worth of the trading fees in ETH.

With the Ronin Side Chain Phase 2 implementation, revenue ballooned alongside trading volume, and within six months, Axie Infinity's revenue increased 118x.

Most notably, breeding fees surpassed marketplace fees in May, and this increase is most likely due to the Ronin migration, which lowers the costs of breeding and the increased demand for Axies. In June alone, breeding fees accounted for $6.9 million, or 57%, of the total revenue.

  • Dogecoin flew to the moon as it gained 366% and outperformed the Top-5 cryptocurrencies

As the market entered a meme frenzy in Q2, Dogecoin led the pack with an impressive 366% gain. On the other hand, Bitcoin suffered a loss of 40%. Overall, Q2 returns underperformed in comparison to the previous quarter.

  • Bitcoin ended Q2 2021 at $35,969, a 44% decline from its All-Time High

Bitcoin's price has declined since hitting its all-time high in April. On the 22nd of June, it briefly touched its lowest price at $29,154, representing a 55% drawdown.

Bitcoin ended the quarter at $35,969, a 40% decline in price, and consolidated in the $30,000 to $36,000 range.

The large sell-off can mainly be attributed to:

  1. Tesla no longer accepting BTC as a medium of exchange due to its environmental impact
  2. The Federal Reserve may raise interest rates sooner than expected to curb higher than expected inflation
  3. Regulations from China clamping down on Bitcoin mining
  4. Overleveraged traders resulting in cascading liquidations
  • BSC and Polygon are leading the DeFi expansion beyond Ethereum

Despite the 65% Total Value Locked (TVL) quarterly growth, Ethereum saw its TVL dominance drop from 93% to 79% in Q2. Cheaper alternatives such as Binance Smart Chain (BSC) and Polygon are slowly capturing TVL market share.

Undeterred by numerous hacks, such as the PancakeBunny and Venus incidents, BSC successfully captured 13% of June's TVL share. This represents an almost 2x increase from March.

Meanwhile, the delay of Ethereum scaling solutions is probably the main contributor to the 5% growth of Polygon's dominance. DeFi heavyweights have also been deployed on Polygon, such as 1inch Network, Aave, and Curve. TVL for these protocols rose as a result.

  • SHIB outperformed DOGE with a quarterly return of 11,566,501%

Those who bought Shiba Inu (SHIB) for $1 at the start of the year would have enjoyed returns of $456,929 at its peak. Half of the quadrillion SHIB was sent to Vitalik Buterin, co-founder of Ethereum. The logic is akin to burning tokens because users assumed that Vitalik would not cash out the SHIB tokens.

However, Vitalik sent 50 Trillion SHIB ($1B at the time) to the India Covid Relief Fund on 12th May 2021. Subsequently, he burnt 90% of his SHIB, and as a result, SHIB has gone down by 75% since.

  • Gaming NFTs saw renewed interest, although floor prices have also dropped

The second quarter of the year also saw new games, including Alien Worlds and R Planet, experiencing large spikes of interest, which has since slowed down. Alien Worlds (TLM) was listed on Binance on 13th April and peaked within the month at $9.05. Meanwhile, R Planet released R-Planet Land on 14th April and peaked in May at $342.47.

Floor prices for those that were established before 2020 have been relatively stable throughout the quarter. However, this does not apply to F1 Delta Time which saw a significant drop from $3,534 in February to $751 in June.

  • Spot exchange volume had its monthly high in May at $3.5 trillion before it dropped 60% in June 2021

Overall, Q2 spot trading volume across the Top 10 centralized and decentralized exchanges grew from $4.4 trillion to $7.4 trillion (+69%). The $3 trillion growth was largely driven by centralized exchanges, contributing 88% of the quarter's increase.

At the same time, decentralized exchanges recorded higher growth compared to centralized exchanges (growth rate of 131% vs. 65%) and contributed to 12% of Q2's total growth.

However, the total trading volume of both centralized and decentralized exchanges decreased by nearly 60% in June, ending the quarter at $1.43 trillion, a $2.1 trillion drop from May.

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Since 2014, CoinGecko has been the trusted source of information by millions of cryptocurrency investors. Its mission is to empower the cryptocurrency community with a 360-degree overview of the market. CoinGecko provides comprehensive information from thousands of data points such as price, trading volume, market capitalization, developer strength, community statistics and more. It currently tracks over 7,900 crypto assets from over 400 exchanges worldwide. For more information, visit https://www.coingecko.com.