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Axie Infinity Has Left Filipino Gamers Despondent and in Debt (time.com) 48

Posted by msmash from the tough-luck dept.
Andrew R Chow and Chad De Guzman, reporting for Time: Samerson Orias was working as a line cook last year in the rural Philippines when his friend told him he could make way more money playing a new video game. Orias was earning about 4,000 pesos a month (about $80, a little less than half the national minimum wage) making takoyaki -- Japanese octopus balls. His friend told him he and others were pocketing up to $600 a month playing Axie Infinity, a game fueled by cryptocurrency and NFTs. Orias, now 26, desperately needed an escape hatch from his financial woes: his mother had had a stroke and required medication, and electricity and grocery bills were stacking up. So he plunged into Axie, doing battle with cartoon monsters for hours deep into the night. He soon began earning cryptocurrency, which he converted into pesos, allowing him to take better care of his mother and his home. At the same time, thousands of young people in the Philippines were jumping headlong into the game.

For a brief moment at the peak of crypto's astonishing 2021 boom, these young Filipino players were fulfilling a longtime dream of crypto's most ardent evangelists: that "play-to-earn" blockchain games like Axie could lead the way to a more equitable, opportunity-rich global economy. Fourteen months later, most Filipino players, including Orias, have exited the game nursing anger and anxiety -- and, in some cases, thousands of dollars down. Orias grew to hate playing the game. It was boring and stressful, he says, a common refrain among the dozen players TIME interviewed for this story. "I felt fatigued all the time. I became more aggressive in every aspect of my life," he says. The story of Orias and Axie Infinity serves as a cautionary tale for crypto and its bombastic rhetoric about changing the world. Many crypto thought leaders, when rebutting criticism about the unsavory aspects of the space, point to its impact in developing countries. But Orias and others say that Axie Infinity reinforced predatory systems and gave them false hope. Innovative metaverse ideas like Axie Infinity offer immense promise -- but also tangible peril for those who feel they have no other option but to take the plunge into the digital unknown. The game initially made a huge impact in the Philippines. At one point, players there made up 40% of the game's user base.
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Axie Infinity Has Left Filipino Gamers Despondent and in Debt More

Axie Infinity Has Left Filipino Gamers Despondent and in Debt

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  • We have a name for that: it's called work.

    • Unless you are providing a value to someone, you are not being productive. Economies fundamentally work by organizing labor and capital among participants. You can not get rich by creating the medium of exchange within that economy unless you are the government or one of its 9 anointed benefactors (member banks of the Fed).
      • What about rent seeking?
        • You are providing a value in the form of your capital. Creation of currency is not capital. If you lend it to someone and they do something productive with it, then charge them a share of their productivity for using your capital; then you are good. If you sat on property and refused to rent it, it isnt being productive, but since it is yours, itâ(TM)s your loss.
    • Not so much play as more of work yourself to death for a modicum of comfort.

    • But what about like...porn stars? I think that counts as play to earn.

      • Do you think they are enjoying it?

        • Generally, yes. It's much like the gaming streamers - a few make it big, a number make an average wage, and most make nothing notable. There are easier gigs that pay more stable wages. I know a few friends irl that have tried and failed on only fans and now work retail or support or whatever -- it's just as difficult as the gaming streams to break into. Not something people tend to just fall into unintentionally, despite what Exodus Cry, etc want you to think

          • Take a few minutes to peruse r/SexWorkers. It's actually interesting what they have to say about their profession. A lot of them consider a regular 9-5 job as being something they're occasionally forced to do (like because they had kids or something) and they say they hate it, they'd much rather do work as prostitutes because they can choose their clients and they only work whenever they feel like it. And all of them seem to have a mixture of some clients that they really enjoy having sex with, some of thei

        • Whether or not one enjoys it doesn't matter. It qualifies as "work" if it delivers value to someone else in return for payment.

        • Do you think they are enjoying it?

          Not everybody enjoys their job.

        • Are you impling that they fake enjoyment?

          Kidding, of course.

          There are a lot of things I enjoy doing that I won't make a career out of because the joy usually leave my hobbies or activities the momement money is involved.

          Heck, after a full day at work on my laptop, I have trouble even logging into my PC at home even though I really enjoy it

  • How he got into debt (Score:4, Informative)

    by phantomfive ( 622387 ) on Tuesday August 02, 2022 @02:36PM (#62756678) Journal

    It was a multi-level marketing scheme. At the bottom, you could make $29 a week (seems the first two weeks gave you a bonus). The guy above you also makes $29 a week from you (and from other people). To move up the level, you had to pay money.

    • Re: (Score:2)

      by fermion ( 181285 )
      MMF is an easy gimmick with kids because they are told they deserve to be rich and should not have to work hard. In the US corporations drive the message that school is boring and a waste of time, the no one needs college, all so they have a constant supply of desperate minimum wage workers

      Social media and gaming in the new pied piper for kids. Make videos of yourself. Play games. Get rich. Everyone is doing it. Is it any wonder we have dead teenagers on the side of the road, despondent when they realize

      • In the US corporations drive the message that school is boring and a waste of time, the no one needs college, all so they have a constant supply of desperate minimum wage workers

        Examples where corperations said no one needs college?

    • Re: (Score:2)

      by mjwx ( 966435 )

      It was a multi-level marketing scheme. At the bottom, you could make $29 a week (seems the first two weeks gave you a bonus). The guy above you also makes $29 a week from you (and from other people). To move up the level, you had to pay money.

      Yep, pyramid schemes are not just a first world problem.

  • How they lost money - ponzi (Score:5, Interesting)

    by SuperKendall ( 25149 ) on Tuesday August 02, 2022 @02:37PM (#62756682)

    One thing I didn't get from the summary was, how people who played a game where they earned various rewards, ended up in debt???

    Well this sentence from the article pretty much explains it all I think:

    he decided to enter the game as a scholar. In 15 days, he earned $487. He soon invested $1,200 to buy his own Axie monsters

    So if he stuck it out as a scholar, maybe he would have only earned money, but in an attempt to earn even more money he bought "Axie", and thus entered the realm of the Ponzi where at first he might have made money, but eventually they run out of suckers to buy Axie and thus what he bought became less valuable than what he paid for it, and he probably borrowed money to buy.

    • Followup I guess the Axie were only involved in helping you earn more SLP (Smooth Love Potion) tokens, and those are actually what lost value.

      Still a ponzi.

      • SLP (Smooth Love Potion) tokens,

        Is that what they were actually called? These people aren't even trying anymore.

        • Is that what they were actually called?

          Yeah that is one reason I felt the need for a follow-up post! I couldn't believe that's what the in-game currency was called either.

      • MLM, not Ponzi. Different mechanism.
        • Essentially the same, but with just enough differences to bypass anti-ponzi regulations.

        • MLM, not Ponzi. Different mechanism.

          Is that really the case though? I thought an MLM was more built on getting other people to join and where you have a kind of "team" under you, earning you money (here I am thinking of LuLaRoe). I didn't notice anything like that from the article, it was more a central org just convincing more people to buy monsters to get more currency. There was recruitment but I didn't see mention they gained anything from the recruiting or they were organized under anyone else.

          I onl

          • When I think of a Ponzi scheme, the investors are unaware of the underlying system (which require new participants); with MLMs, their structure is similarly Ponzi-like, yet transparent in that manner and expressed as if it doesn't ultimately rely on new participants.

            • After finishing the article, SuperKendall, I more so appreciate your point... The game is arguably a communal MLM, but it seems to lack that general component (I'm sure there's some in-game reward for inviting or recruiting people, but that's beside the point). Definitionally, I do think a Ponzi scheme involves explicit fraud by hiding the mechanism of payouts.

              • Yeah I see what you mean there, I'm wondering if it's really some other kind of structure beyond those two?

                It comes off as a scam in that you could see the end coming from a ways off, but I'm just not quite sure how to categorize it. Maybe it's technically not a scam but just a bad idea.

            • Re: (Score:2)

              by jythie ( 914043 )
              Sadly, a lot of people going into ponzi schemes know what they are, but are hoping to be be on the 'winning' side this time.
          • A Ponzi scheme is simply an offer of high returns which, in fact, require more investors. An MLM gets people to buy something they can sell on. With an MLM the mark works to push the scheme, being emotionally invested in his success and involved in the functionality of the organization, at least as far as finding more marks goes. IMO an MLM is much more evil. Both steal money but one also steals time and, to a greater extent, humanity.
    • In the way you have. What we had here is a guy who was making money doing something and so he decided to try and start his own business doing that thing instead of working for others. Under normal circumstances we would consider that an admirable thing to do. In theory he'd be a job Creator and you know how much we love job creators /s.

      In this case it seems more like he's the victim of the Ponzi scheme rather than someone joining it. It doesn't seem like he's so much as intended to be a part of a pyrami
  • Your goal shouldn't be to accumulate money, or cryptocurrency or NFTs. What you want to acquire is the means to generate wealth. That could be as simple as learning skills or a trade, acquiring the tools of your trade, or ownership of a company that produces profit. These are the things you want to acquire, not currency. There's no wealth generated by playing a video game. The whole things is a ponzi scheme where bigger and bigger fools are tricked into participating.

  • "DeFi" = "Deregulated Finance" (Score:4, Insightful)

    by Anonymous Coward on Tuesday August 02, 2022 @02:53PM (#62756744)

    Don't let the crypto bros fool you: "DeFi" means "Deregulated Finance", not "decentralized" as they're trying to pass it off.

    The crypto bros all want to wrestle control away from governments and the 'big banks' (just like they're trying to do with "Web3" vs. all tech companies), under a system in which they set the rules ("code is law") and do it without any oversight, and hence no accountability whatsoever. Why else do you think they're all throwing a fit whenever the specter of regulation comes up (you know, the thing all legitimate financial institutions have to adhere to?)

    • Not sure why you were modded down. Your premise at least deserves some debate.
    • Each thing has its positive and negative sides and the same with cryptocurrency!

    • Re: (Score:2)

      by GBH ( 142968 )

      Isn't that one and the same thing though? If it's de-centralised it's broadly deregulated too outside the participating parties defining their own rules. But the issue isn't with its deregulated nature. Billions and billions and billions of FIAT currency and property is fraudulently and opaquely stolen, laundered and/or lost every single day even in the highly regulated financial markets and systems of civilised countries. Most of that goes unseen, unrectified and simply disappears.

      With blockchain EVERY SIN

  • It is a currency.

    It is not an investment product. It gets treated like one, but it's not supposed to be. That's not it's function.

    It is meant to be exchanged for goods and services. Yes, it will have some value, as all fiat currency does, because it's meant to have value. But it is not supposed to be sitting in a hard drive.

    The whole fraud and scheme aspect of ALL cryptocurrencies stems from that one problem: nobody wants to use their currency.

    What might be an interesting way to solve this problem, is

    • Re: (Score:2)

      by jythie ( 914043 )
      Which makes it a perfect pair for these blockchain games. being paid in a currency no one wants to play a game no one wants to play.

    • Economics 101 says that money performs several functions:

      1) A medium of exchange - you can buy stuff with it
      2) A measure of value - you can use it to value assets even if you don't want to buy or sell them
      3) A store of value - you can keep it in a shoebox/bank/mattress/bank account and it still has some value in six month
      4) A means of investment - you can lend it productively (or not)

      At present crypto isn't ready for all these tasks and you still have to go via regular money in most cases.

      Discuss....

      Keith

    • The whole fraud and scheme aspect of ALL cryptocurrencies stems from that one problem: nobody wants to use their currency.

      I can't imagine why.

      First, there is the huge volatility factor. BTC lost over half its value in 2022; even with inflation and looming recession, the dollar hasn't lost that.

      Cash is easy to transfer, Venmo and Zelle facilitate peer to peer dollar transfers, credit cards allow for payments and add airline tickets and warranties, and all of those transfers happen more-or-less instantly and with a fraction of the fees that cryptocurrencies seem to charge, even for international purchases in foreign currencies.

      I

    • What might be an interesting way to solve this problem, is to add a timer function to the blockchain, where each coin starts to depreciate after it's generated, and the only way to rejuvenate it's value is to spend it. So long as it keeps moving, it's value will be retained. Anyone hoarding it will lose money.

      So, exactly like the dominant nation-state currencies.

      Anyone hoarding it will lose value as the economy is manipulated and prices consistently rise over time. If your grandparents worked hard to save up enough USD in 1955 to afford a decent starter house with a yard, then they hid those dollars in a shoebox in the basement, today you could take that cash and... barely be able to afford a not-completely-shitty high-mileage used car that might (if you're lucky) last 3 years before needing major maintenance.

      No

  • Tale as old as time. Pile it on the stacks of other similar schemes. My empathy for them is tied to the fact that their circumstances led them to follow this path as a possible out.

  • The promise of getting paid to play video games turned out to be too good to be true? Go figure.

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