Axie Infinity Tokenomics: Circulation and Emissions Schedule

If you’re looking for information on the number of circulating Axie Infinity tokens or their inflation rate, you’re going to have a bad time. We did our best to review the numbers and find some answers.

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Why are Axie Infinity’s Tokenomics Such a Mess?

The numbers related to Axie Infinity Shard (AXS) circulation are a rat’s nest of confusion. Even the official figures provided by the project’s developer, Sky Mavis, don’t agree. The company’s Ronin Explorer pegged circulating supply at 54 million as of July, while their staking platform placed the figure at 66 million. Sky Mavis’ own whitepaper indicated initial circulation would be set at 59,985,000, higher than it claimed in July. Other websites — including CoinMarketCap, CoinGecko, and Messari — put July circulation in the ballpark of 82 to 83 million. Here is where the numbers stood as of July 23:

- Ronin Explorer: 54,513,260
- Stake.axieinfinity.com: 66,265,526
- Nomics: 71,046,952
- CoinMarketCap and Messari: 82,475,673
- CoinGecko: 83,103,026

All of the sources agreed AXS had a capped supply of 270 million.

Sky Mavis Abruptly Changed Reported AXS Circulation in June

In June 2022, Sky Mavis changed the reported AXS circulation figure. It did not explain its reasoning. At least one member of Axie’s Discord chatroom noticed the change, writing, “Anyone notice AXS circulating supply dropped from 81m to 64m in [the] AXS staking dashboard. And the total supply in Ronin manner is 53m. Did they burn?”

Axie administrators didn’t respond to the user, but it is safe to say the tokens were not burned. (Burning $34 million in value without fanfare? That doesn’t happen in the world of cryptocurrency.)

It isn’t clear when the change took place. Prior to the move, Sky Mavis’ staking website was last archived on the Wayback Machine on April 27. At the time, the site showed 83 million AXS in circulation. For your convenience, GoblinCrypto has saved a screenshot of that moment in time. When it was next saved on July 1, Sky Mavis claimed AXS circulation stood at 66 million — a decline of 17 million.

Axie Infinity’s Own White Paper Said Circulation Would Start at 60 million

Ready to make your head hurt? Axie Infinity’s own white paper said circulation would begin at 59,985,000 —on Nov. 4, 2020! If you believe the latest Sky Mavis figures, that means circulation increased by just 6 million over the two following years. Remember, the maximum supply is 270 million. So at that rate, the project shouldn’t reach its cap for another 66 years — sometime around 2078. Sounds great, right?!

Untangling the Mess

Axie users periodically notice that the numbers don’t add up. A user named “Son” said in a July 11 Discord message, “I’m confused. … On stake.axieInfinity.com AXS circulating supply is 66,265,119 AXS but on [the Ronin explorer] total supply is 54,454,857. Then on CoinMarketCap it’s 82,475,673.”

Fortunately for developers, the user found quick reassurance. “[Don’t worry] answered it here before,” another person replied. “I forgot the answer haha.”

“Ah okay thanks,” Son replied.

So what are the real numbers? Let’s start with the white paper.

Token Calculations from Axie Infinity’s White Paper

According to Axie Infinity’s white paper, the project began with 59,985,000 tokens in circulation on Nov. 4, 2020. That included 29,700,000 sold in an immediate public sale. Prior to the public sale, the team sold 8,640,000 tokens to investors in a private sale at a per-token cost of $0.10 each. As of July 2022, 6,480,000 of those tokens had been released. Combined, tokens from the public and private sales accounted for 36,180,000 of those circulating.

Staking rewards paid to players earning interest — according to the schedule — should have accounted for 16,962,000 tokens as of July 2022, which brings us to a total of 53,142,000 AXS tokens in circulation. This is where we begin facing a problem with the official numbers.

Sky Mavis Appears to be Suppressing 54,675,000 AXS from Official Circulation

The white paper said another 22,275,000 tokens were scheduled for distribution to Sky Mavis and Axie developers by July 2022. Adding that to the 53 million brings us to a total figure of 75,417,000 — 9 million more than the number acknowledged by Sky Mavis’ staking website, and a whopping 21 million more than the number on Ronin Explorer. Thus, it is safe to say developers are not counting their own tokens as part of Axie’s circulating supply. At least not in their entirety.

If they’re following the Solana model, it could be that they’re refusing to count their tokens until they choose to sell them. (A California man filed a lawsuit against Solana this month partially for cooking its books using that accounting method.) Stranger things have happened. Let’s omit those for now.

We encounter the same problem with Ronin Explorer if we try to count 11,700,000 tokens that were scheduled for release to advisors. That list includes Binance, Delphi Digital, Hashed, and The Sandbox co-founder Sebastièn Borget. However, adding that figure to the 53 million does bring us to 66,304,500. That’s just 400,000 more than the total reflected by Axie’s staking website.

Another 13,162,500 AXS should have been released from the game’s ecosystem fund as of July, for a total of 79,467,000. That puts us in the ballpark of the number displayed by CoinMarketCap, CoinGecko, and Messari — and is probably the closest to reality. That’s despite the fact that it does not account for 32.4 million unlocked tokens sitting in Axie’s play-to-earn fund.

Here are all the tokens the white paper said should have been circulating as of July 2022. We’ve underlined the four that Ronin Explorer appears to omit.

Play-to-earn: 32,400,000
Public Sale: 29,700,000
Staking Rewards: 16,962,000
Ecosystem Fund: 13,162,500
Advisors: 11,700,000
Sky Mavis: 22,275,000
Private sale: 6,480,000

July 2022 AXS Circulation: Rational Voices Say it’s 80 Million

While we can appreciate Axie’s creative accounting methods, we’re going to assume that as an average Axie investor, you’d like to know about all of the tokens that could hit the market at any given time. That includes the stashes held by developers, Binance, and other parties who have the right to sell anytime they choose. So for reasons laid out above, we’re going to say that AXS circulation as of July stands at about 80 million.

AXS Circulation Will Cap at 270 Million in April 2026

By April 2026, the number of circulating AXS should rise by 190 million, or 237 percent. The distribution isn’t linear, but if you want to average it out, that would come to about 4.31 million tokens monthly over four years. In addition to monthly unlockings and emissions, bulk unlockings will take place in November 2022 (18,576,000, or 6.8 percent of total supply); May 2023 (16,416,000/6.08 percent); November 2023 (13,266,000/4.9 percent); May 2024 (13,266,000/4.9 percent); and November 2024 (11,691,000/4.3 percent).

Line Graph Comparing Emission Rates

Here’s a graphic illustration of what emissions for AXS will look like over the next several years compared to a few other tokens. (They include Solana as well as DeFi Kingdoms’ native tokens, Jewel and Crystal.) The chart is based on the premise of accepting Axie developers’ assertion that the 54,675,000 tokens that belong to Sky Mavis and the game’s play-to-earn fund are missing.

However, like the big market data aggregators, we did count tokens allocated to the game’s ecosystem fund and to its advisors. The graph’s projection also accounts for all seven emission categories — including the tokens allocated to Sky Mavis and Axie’s play-to-earn functions.

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AXS Price Projection for November 2024

What will Axie’s price look like in the future? It’s hard to say without a full picture of circulation data. Here’s why.

As of July 25, Axie’s price was about $15.80. With 82 million tokens in circulation, that made for market capitalization of $1.29 billion. That’s the number CoinMarketCap and CoinGecko report. But if we were to take the number reported by Sky Mavis’ Ronin Explorer, we would find market cap to be much lower — $861.3 million, to be exact.

Let’s go with the larger, 82 million figure. (Remember, that still excludes 22.2 million Sky Mavis tokens and 34.2 million play-to-earn tokens.) In November 2024, barring any changes, 189,683,673 AXS tokens should be circulating. Market cap would need to rise to $2.99 billion — a little more than double where it stood as of July 2022 — in order for AXS to hold its $15.80 price. If market cap stands still at the $1.29 billion figure, token price will instead fall to roughly $6.80.

For another scenario, let’s say Sky Mavis and its developers decide to spend the 22,275,000 AXS they have on hand by the end of 2024. That would amount to 211,958,673 tokens in circulation. If market cap doesn’t move, that means a per-token price of around $6.08.

But there is at least one estimate we can provide with certainty. AXS will eventually reach its cap of 270 million circulating tokens. In order to return to its record-high price — set in November 2021 at $164 — with 270 million tokens in circulation, Axie’s market cap will need to reach a total of $44 billion.

On the bright side, there’s at least a good chance it will be almost four years before Axie’s token reaches its circulating cap. That means its community has plenty of time to find that $44 billion.