Storms are gathering around hit crypto game Axie Infinity as regulators in its prime market, the Philippines, expressed their intention to tax its players and publisher.
- Income from play-to-earn crypto games such as Axie Infinity should be taxed, the Manila Bulletin reported Monday, citing Undersecretary of Finance Antonette C. Tionko.
- Tionko said that whether Axie Infinity tokens are assets or securities is being discussed by the country's Securities and Exchange Commission (SEC) and central bank.
- The undersecretary also said that although the game's Vietnamese creator, Sky Mavis, is not registered in the Philippines, it must pay taxes in the country for any revenue created through local sources.
- The SEC reiterated that the game and its publisher are not registered in the Philippines, and that Sky Mavis doesn't have a license to sell securities, the Manila Bulletin said yesterday.
- In response to the regulators' statements, Sky Mavis co-Founder and COO Aleksander Leonard Larsen told CoinDesk in a message on Thursday that "Axie Infinity does not sell SLP or provide liquidity on the market," and that the tokens are only earned by playing the game or acquired from other players.
- Inspired by Pokémon, Axie Infinity has players battle using NFT anime monsters, called Axies. When they win, the earn SLP tokens, which they can then exchange for fiat currency. Players can also sell their Axies on NFT marketplaces.
- Some people "set up scholarships, or companies, then they hire other players to work for them," Larsen said.
- Globally, it counts almost half a million daily active users, and more than 60% of them are in the Philippines, Leah Callon-Butler, director of consulting firm Emfarsis, wrote in a CoinDesk column in July.
- The price of the Axie Infinity token, AXS, has surged from around $5 at the end of July to over $70 at the time of writing.
UPDATE (7:30 UTC, Aug. 26, 2021): Adds details about Axie Infinity play-to-earn model, quotes from Sky Mavis.
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