Smooth Love Potion (SLP) Explained

Updated October 23, 2026

Smooth Love Potion is the reward token of Axie Infinity, the play-to-earn game developed by Sky Mavis. Its price history is a case study in what happens when a token is issued by gameplay without a matching sink. Updated September 2026.

SLP at a glance

• Type: ERC-20 token on the Ethereum blockchain

• Game: Axie Infinity, developed by Sky Mavis

• Earned by: Arena mode player versus player battles, Adventure mode, and daily quests

• Spent on: breeding new Axies within the game

• Supply: unlimited issuance, tied to player activity

• Peak: reached an all-time high in May 2021

• Since: sustained decline as issuance outpaced consumption

• Tradable: on exchanges, convertible to other cryptocurrencies or fiat

The tokenomics problem

This is the central fact about SLP and it explains everything else.

SLP is created when players win battles and complete quests. There is no fixed supply cap: the more people play, the more tokens enter circulation.

The only meaningful way tokens leave circulation is breeding new Axies, which consumes SLP.

The imbalance follows directly. When player numbers grow, issuance grows with them, but breeding demand does not scale at the same rate, particularly once the market for new Axies is saturated. Supply expands faster than it is consumed, and the price falls as a matter of arithmetic rather than sentiment.

This is why the peak in May 2021 was not recovered. The decline was not a market cycle but the visible result of the issuance model.

What SLP does in the game

Axie Infinity involves collecting and raising fantasy creatures called Axies, then battling them against other players or computer opponents.

SLP serves two functions: it is the reward for successful play, and it is the resource consumed when breeding new Axies.

As an ERC-20 token it can be moved off-platform, traded for other cryptocurrencies, or converted to fiat currency.

How players earn it

• Arena mode: player versus player battles, the primary earning route

• Adventure mode: player versus environment gameplay against computer opponents

• Daily quests: additional rewards for completing set objectives

The game attracted players globally, with particular uptake in regions where local income levels made the earnings meaningful. That adoption pattern is what made Axie Infinity a widely cited example of play-to-earn.

It is also what made the token's decline consequential. Where players treated the game as income rather than entertainment, falling token prices reduced real earnings, and participation fell as a direct result.

Technical constraints

Running on Ethereum exposes the game to that network's limitations, particularly transaction costs and throughput during periods of congestion.

Scaling has been an ongoing challenge for the project, as it has for many applications built on Ethereum.

Regulatory attention

Regulators in several countries examined the token, particularly during the period when earnings were substantial enough to constitute income for players.

The question raised was whether play-to-earn rewards constitute taxable income and, in some jurisdictions, whether the arrangement resembles an unregistered investment scheme. If you earn tokens through gameplay, check the tax treatment where you live rather than assuming game rewards are outside the system.

What the model revealed

• A token issued by activity with no supply cap requires a sink that scales with issuance, or the price falls

• Play-to-earn earnings depend on token price, so they fall exactly when new players are least likely to join

• Check the issuance and consumption mechanics of any game token before treating rewards as income

• Where rewards are treated as income, check the tax position in your jurisdiction

• Compare regulated venues in our [[crypto brokers|/crypto-brokers]] section

See related material on evaluating crypto projects in our trading guides.

Tokenomics and Price History

Smooth Love Potion: frequently asked questions

What is SLP?

The reward token of Axie Infinity, an ERC-20 token on Ethereum, earned through gameplay and spent on breeding new Axies.

Why did the price fall from its 2021 peak?

Issuance is unlimited and tied to player activity, while the only sink is breeding. Supply expanded faster than it was consumed.

How do players earn SLP?

Through Arena mode player versus player battles, Adventure mode against computer opponents, and daily quests.

earn SLP tokens

What is SLP used for?

Breeding new Axies within the game. That is the only significant mechanism removing tokens from circulation.

Is SLP tradable outside the game?

Yes. As an ERC-20 token it can be traded for other cryptocurrencies or converted to fiat on exchanges.

Are play-to-earn rewards taxable?

Regulators in several countries have examined this. Check the treatment in your jurisdiction rather than assuming game rewards fall outside the tax system.