Missed out on Axie Infinity's 740% gain? Here's what you can do!

The month of July started with AXS trading at $5 and ended with it at $42, marking a 740% gain in a span of a month!

Am I kicking myself for missing out on such an opportunity?

Of course I am! I first read about Axie Infinity during the first week of July when AXS was trading at $10 but decided not to buy as I thought that the potential of the NFT gaming sector had already been priced in, given that AXS had rapidly doubled in less than a week. I told myself I would buy AXS if it dropped below $10, but it never returned to the single-digit range :/

But let’s not dwell so much in the past; after all, hindsight is 20/20. Instead, I explored other NFT games that I could invest in! Here are some ideas for you to consider too if you’re FOMOing as badly as I did:

Disclaimer: All ideas presented below are merely my opinions. They do not constitute as financial advice and are just potential ideas you can consider. You should always do your own research before investing!

Firstly, I decided to explore NFT gaming platforms on the Binance Smart Chain. A few of them were:

• Binamon
• My DeFi Pet
• Battle Pets
• CryptoBlades
• Mist

Note that a lot of these tokens have already enjoyed massive monthly gains, so do taper your ROI expectations if you choose to invest in these games.

To analyse these gaming platforms, you can use dapp.com’s social sentiment score, or you can also use dappradar to gain insights into the growth of a platform’s user and transaction volume.

After NFT gaming platforms on BSC started booming, I took profit (a bit too early, unfortunately) and moved on to NFT gaming platforms on Polygon. The main one that I’m invested in is Aavegotchi, which is pretty similar to Axie Infinity in terms of gameplay.

Strategy

For these types of gaming platforms, there are a few ways to capitalize on their growth:

1. Buy the game's token and hodl
2. Play to earn

If you are interested in Option 2, you can check out these articles on Axie Infinity and CryptoBlades to find out how you can earn by playing!

But for those who don’t have time / not interested in playing the game, don’t worry about missing out on yield-earning opportunities, as there are still other ways to earn yield on these game tokens, without even playing the game itself!

I will use Aavegotchi as a case study here:

The game token for Aavegotchi is GHST. Instead of using GHST to buy gotchis and play to earn, you can actually choose to stake GHST tokens.

For every GHST that you stake, you will earn 1 FREN per day. FREN is an in-game token, but it only has 1 purpose: for players to redeem raffle tickets so that they can accrue in-game items.

Since I am a non-player and am not interested in redeeming in-game items, these raffle tickets are worthless to me. But these are valued by game players, so I can instead choose to sell these tickets to them on the NFT marketplace and earn more GHST in the process.

The generic process goes like this:

For every GHST staked, you can earn 1 FREN per day, and from the table below, for every FREN, you can earn 0.00147 GHST on average.

Assuming you have 10000 GHST initially, you can stake it to earn 10000 FRENS daily, which can be used to redeem tickets which can then be sold for 14.7 GHST on average.

Annualising this returns an APR of nearly 54%, and we haven’t even taken into account the effects of compounding!

There are also other ways to earn more FRENS. Instead of staking GHST, you can stake liquidity pairs such as GHST-USDC, GHST-QUICK and GHST-ETH.

In addition, if you stake GHST-ETH on Aavegotchi, you’ll be issued your ‘receipt’ in the form of stkGHST-wETH, which you can stake on DinoSwap to earn an additional 200% yield in the form of DINO tokens, which can then be burnt in the GHST extinction pool to yield an additional 50% on GHST tokens. The details on this hyper-compounding method can be found here!

The above methods therefore allow us to gain exposure to Aavegotchi’s game token (GHST) and earn yield at the same time!

Personally, I’ve decided to give the LPs a miss because if Aavegotchi rallies like other NFT gaming tokens, my impermanent loss would be insane, so I’m just staking my GHST.

I’ve been doing this for exactly 3 weeks and I’ve already earned a yield of 3.14%, which works out to an annualized yield of 54.4%. Over this time period, GHST has also since rallied by 60%! This is nothing compared to Axie Infinity’s growth, but hey, it’s still pretty decent in my book.

Alternative Strategy

Apart from chasing the “next Axie Infinity”, you can also check out Yield Guild Games!

YGG is a Decentralized Autonomous Organization (DAO) that invests in NFTs used in the blockchain metaverse.

They intend to earn revenue by renting or selling their own NFT assets to their community of play-to-earn gamers, who can then farm in-game rewards and share their profits with token holders.

Referring to their article on Medium:

YGG just held their IDO on the 27th of July and the tokens were swiped clean in under 31 seconds by 32 crypto whales, leaving retail crypto investors like myself empty-handed. In fact, I lost a bit of money due to the exorbitant transaction fees on Ethereum’s network.

Nevertheless, the YGG token is available for trading now for those who are salty that they missed out on the auction.

Risks

There are definitely plenty of risks in this space given the high volatility in the prices of these tokens as ‘NFT gaming’ is the hot sector right now.

Risk can be managed by diversifying across various gaming platforms and viewing this investment with a VC mindset. As long as one platform booms, your entire portfolio is likely good to go!

I hope you managed to gain some new insights from this Opinion piece and all the best in your investments!