Smooth Love Potion (SLP) jumps 67% after Axie Infinity revamps reward structure

Key Takeaways:

• Axie Infinity announced an update that would tackle the platform’s token inflation issue.
• SLP, Axie Infinity’s native token, has jumped 66.7% after the announcement on Feb. 3.

NEW DELHI (CoinChapter.com) — Play to earn blockchain game Axie Infinity’s native token, Smooth Love Potion (SLP), has been on the rise since the platform announced revamping its reward structure.

SLP has been trending downwards since Jul last year, losing over 97% between July 21’s high of $0.3462 to reach a low of $0.00936, SLP’s lowest ever, on Feb 2 this year. However, since the news of Axie’s economic revamp, SLP prices have grown.

Smooth Love Potion gained 17% on Feb. 3, the day of the announcement. Afterward, bears moved in before SLP registered another double-digit gain, jumping 27.4% on Feb 6.

Also Read: Axie Infinity looks poised to hit $275 as AXS paints classic bull pattern.

Despite the uptrend, SLP remains short of the token’s immediate resistance at $0.0169. However, if the Smooth Love Potion price maintains upward movement, SLP could target the resistance level near its 50-day MA line at $0.02.

SLP prices could reach the $0.024 resistance level before prices pull back.

Meanwhile, the relative strength index leaped from the oversold to the neutral regions on Feb 5. SLP’s RSI is currently neutral, clocking 56.31 on the daily charts, with the RSI trendline moving upwards nearly vertically.

SLP’s MACD Remains Bullish

The Axie Infinity token is currently bearish across all time horizons, trading below its 50-day, 100-day, and 200-day Moving Average trendlines.

Conversely, if the SLP token price fails to continue its upward movement, the token has immediate support near $0.0125. Further sell-off could pull down prices to $0.010 before any recovery occurs.

Also Read: Axie Infinity virtual land sold for $2.3M while AXS jumps 18.74%.

SLP’s MACD has been in contrast with its price movement recently since charting a bullish crossover on Jan 27. A bullish crossover occurs when the MACD line (difference between 12-day and 26-day EMA) moves above the MACD signal line (9-day EMA of MACD).

Furthermore, bars on the MACD histogram are expanding, indicating strengthening bullish momentum.

Axie Infinity Slashes SLP Creation

Axie Infinity revealed a revamped reward structure for its Player-vs-Player (PVP) game mode. The firm has expanded its leaderboard slots to 300,000 and increased the amount of AXS reward to 117,676 for Season 20 of the game.

The platform noted that SLP inflation has increased drastically, with “around 4x more SLP being created (supplied) per day than burned (demanded) through breeding.”

The P2E game platform has decided to remove SLP rewards for Adventure mode and daily quests. The new rule is also applicable to players who complete the Adventure mode for the first time. Meanwhile, players with MMR less than 800 will earn 1 SLP per win.

Axie Infinity believes the decision to cancel rewards for Adventure mode would remove nearly 130 million SLP tokens every day. Furthermore, the team noted that the daily quest added an extra 45 million SLP tokens into the supply.

Hence, removing the rewards system would essentially burn nearly 175 million SLP tokens per day. According to the new rules, players would only receive SLP tokens as rewards for area combat.

We know that this is painful medicine. The Axie economy requires drastic and decisive action now or we risk total and permanent economic collapse. That would be far more painful. 

Excerpt from Axie Infinity’s announcement.

The platform’s decision would likely reduce SLP’s daily supply by approximately 56%. In addition, the Season 20 update would make SLP scarcer, resulting in more valuable Axies. In detail, Axies are the in-game creatures that also serve as an NFT.

Consequently, an increase in the value of Axies would likely attract more gamers, NFT collectors, and crypto supporters, which would theoretically raise the demand for the platform’s other native token, AXS.

At the time of writing, SLP was trading at $0.0163, up 20.74% on the day.