The blockchain-based game Axie Infinity has risen in popularity due to its potential to generate a passive income. In this guide, we cover the mechanism that facilitates this and describes the steps to complete it.
Quick Guide: How To Stake Axie Infinity
Staking AXS is best done using the official Axie Infinity wallet, Ronin Wallet. Unless you already have AXS, you will need to buy them from a cryptocurrency exchange. These are the 5 steps to do it safely and efficiently.
- Create a crypto exchange account to enable the purchase of AXS tokens using a fiat currency.
- Complete the KYC process by verifying your identity.
- Deposit your preferred fiat currency and buy Axie Infinity tokens.
- Create a Ronin Wallet and deposit the AXS.
- Stake AXS on the Axie Infinity website by linking your Ronin Wallet and entering the amount to lock in.
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Can Axie Infinity Be Staked?
Yes, Axie Infinity has a staking feature where its native cryptocurrency, Axie Infinity Shards (AXS) can be staked in its ecosystem. By staking AXS, players can earn rewards in the form of additional AXS tokens and thereby acting as an incentive to support the network and participate in its governance. Currently, AXS can be staked to earn returns of 35% APR where the tokens can be used to spend within the Axie Infinity game.
Complete Tutorial: How To Stake Axie Infinity
Follow these steps to buy and stake Axie Infinity.
Step 1 – Create a crypto exchange account
Unless you have existing AXS tokens in a crypto wallet, you will need to buy them from a reputable crypto exchange. For most, buying cryptocurrency with fiat is best done on a reliable crypto exchange such as Binance. Binance is regulated by AUSTRAC and there is a 100 USDT sign-up bonus available.
Click on the “Sign Up” button. This will redirect you to the registration page where an email address, password, and phone number will be required to be provided.
Step 2 – Complete KYC
Binance is legally required to collect basic information about its customers before any funds can be deposited.
You can choose to verify your identity by submitting a copy of your passport or driver’s licence. Providing basic personal details and uploading your ID documentation is required before any AUD funds can be deposited. However, it should only take 3 or 4 minutes to complete.
Step 3 – Buy Axie Infinity tokens
Funding your Binance wallet with fiat can be done in several ways including credit card, PayID, OSKO, and transfers of crypto from another wallet. Search for the AXS token on its asset list, and either buy it directly with your chosen fiat or place an order on the spot exchange.
Step 4 – Create a Ronin wallet and deposit AXS
The first step is to visit the official Ronin Wallet website and download it as an extension to your Internet browser. Creating a new wallet will require an email address and a secret password.
Once your wallet has been created, transfer your newly purchased AXS tokens from Binance. The wallet address for your Ronin Wallet can be found at the top of the interface where it can be copied.
Step 5 – Stake AXS
Go to the official Axie Infinity website and log into your account. Using the navigation menu on the left-hand side of the interface, click on “Staking“. From here, the Axie staking dashboard will be presented showing a large “Stake” button. Click on this and enter the amount of AXS coins to lock in.
And that’s it – your coins have been staked. Staked AXS coins will slowly generate yields over a long period of time. Removing your coins can be done by clicking on the “Unstake” button and entering the volume to unstake.
What Is Axie Infinity?
Axie Infinity is an online game that combines elements of trading, battling, and collecting digital creatures called Axies. Axies are Non-Fungible Tokens (NFTs) that you own and breed with the intention of battling the Axies of other players and completing quests and challenges. Each Axie comes with its own skills, abilities and traits and can be traded with other players.
The Sky Mavis game is built upon the Ethereum blockchain and implements a play-to-earn model where players can earn income by participating in the game. It has attracted a large community of players, especially in regions with limited economic opportunities, as it offers a way to earn money by playing the game. The mechanism of earning income is its staking feature where players can passively earn its native cryptocurrency AXS.
The game’s success has led to a vibrant secondary market for Axies, where players can buy, sell, and trade their digital creatures for varying prices based on their attributes, rarity, and demand.
Axie Infinity has become a prominent example of how blockchain technology and NFTs can revolutionise the gaming industry, introducing new economic models and opportunities for players around the world.
What Are Axie Infinity Shards (AXS)?
Axie Infinity Shards (AXS) are the native cryptocurrency of the online game Axie Infinity, a popular metaverse token to buy. The ERC 20 token is used to buy and trade Axies as well as participate in the governance of the protocol. The token can be obtained by players through gameplay, governance involvement, and staking their AXS tokens or buying them from a top crypto exchange.
How The Ronin Wallet Works
The Ronin Wallet is the official Axie Infinity wallet and operates as a sidechain to the Ethereum network that it is built upon. Being a sidechain, the purpose of Ronin was to relieve transaction loads, lower fees, and improve scalability for its users. The Ronin Wallet can be installed as a web browser extension or downloaded as an app on iOS and Android mobile devices.
The Ronin Wallet is an integral part of the Axie Infinity game. Its purpose is to store their in-game assets such as Axies, Small Love Potions (SLP), and other ERC-20 tokens. Trading Axies can also be undertaken using the wallet since it is connected to the game’s marketplaces.
More importantly, the Ronin Wallet allows you to stake your AXS tokens in order to earn income which can then be used as a form of currency in the game. In addition, staking rewards can be used to participate in the governance of the protocol regarding how Community Treasury funds are allocated.
How Much Can You Earn Staking Axie Infinity?
At the time of writing, people staking for AXS tokens on the Ronin Wallet can earn 35% APR in annual returns. This means that if you stake your Axie Infinity tokens for a year, then the Return on Investment (ROI) will be approximately 35%.
The Benefits And Drawbacks Of Staking AXS
Benefits of staking AXS
Staking Axie Infinity Shards (AXS) through the Ronin Wallet offers several advantages and benefits to participants in the ecosystem. Here are some of the main advantages of staking AXS:
- Staking rewards: AXS staking can net investors returns of about 35% if the tokens are locked up for a year. Staking rewards are typically distributed to investors on a regular basis, providing an opportunity to increase the number of AXS tokens held. In the short term, players can use their earned tokens to buy and trade items and Axies within the game.
- Governance participation: Staking AXS allows you to have a say in how the Axie Infinity ecosystem is governed. This means you can partake in decision-making processes, such as proposing and voting on protocol upgrades, and how Community Treasury funds are allocated.
- Network security and decentralisation: When you stake your AXS, you contribute to the security and decentralization of the Axie Infinity network. Staking helps secure the blockchain by adding more tokens to the staking pool. This makes it extremely difficult for a malicious 51% attack to occur since more tokens have been added.
- Long-term investment: Stakers of AXS can utilise the Ronin Wallet as a long-term investment strategy to slowly increase their token holdings. AXS tokens could then be sold for fiat currency on reliable digital currency exchange, particularly during a bull market.
- Community engagement: Staking AXS often involves actively participating in the community and staying informed about project updates, proposals, and discussions. This can provide opportunities to connect with other participants, contribute ideas, and shape the direction of the Axie Infinity ecosystem.
AXS staking drawbacks
Despite its advantages, here are some potential drawbacks of staking Axie Infinity.
- The changing regulatory landscape: The regulatory landscape around staking and cryptocurrencies can vary across jurisdictions including Australia. You should be aware of the risks involved with conducting unregulated activities in your country.
- Price volatility of AXS: AXS tokens are a speculative digital asset and their value has been demonstrated to be volatile since its establishment in 2020. For stakers, the price of AXS may fluctuate significantly and therefore potential losses can eventuate if the price decreases from the value you started off with.
- Governance participation considerations: Active participation in the Axie Infinity ecosystem takes time and an understanding of how its mechanisms work. This may not be appealing to all AXS investors.
Frequently Asked Questions
Staking AXS is a worthwhile exercise if you plan to earn more tokens over the long term where investors can earn around 35% APR in returns. The market value of AXS has been relatively consistent since its inception and the popularity of the play-to-earn Axie Infinity game continues to increase its use cases.
Staking Axie Infinity tokens can be a profitable exercise during a bull market. Staking increases the volume of AXS you hold over a long period of time where rewards are handed out regularly as dividends. Selling AXS tokens during a bull market to a fiat currency could potentially result in additional yields.
Conclusion
In conclusion, staking Axie Infinity tokens offers players and investors alike the opportunity to earn passive income while supporting the game’s ecosystem. By following a few simple steps, players can stake their tokens and contribute to the network’s security and decentralization. With the lack of crypto-staking platforms available to stake AXS, the next best option is to use the native wallet of the Axie Infinity ecosystem, Ronin Wallet.
Warren is the co-founder of CoinCryption. He has a passion for cryptocurrency and has been involved in this space for more than 7 years. His other love is digital marketing and has over 15 years of experience.