Last week we announced AxieTree, a lending and borrowing protocol for Axies.
We were extremely encouraged by the warm welcome and enthusiasm from the community. This blog post will cover the core components of the AxieTree platform. At the bottom of this post, you will also find information about our alpha program launching on December 25th. For those of you eager to borrow and lend your Axies you’ve come to the right place!
Disclaimer
AxieTree will be first launching in public alpha with unaudited code. Lenders will be risking permanently losing their Axies if they deposit Axies into the protocol. Our team (the creators of AxieTree) and Community Partners will be lending our own Axies from day 1.
On December 21st, Axie Infinity team made some significant changes to SLP claim periods, where players can now only sync SLPs every 2 weeks. This update is requiring some rework on AxieTree’s end, and thus some of the content on this post is subject to change.
Components of AxieTree
Registration
Users connect their Ethereum address via MetaMask and register with an email. The provided email will be used to register a new Axie Infinity account, and the User will receive their Axie Infinity password in an email sent to the provided email. All Axies borrowed from AxieTree will be sent to this Axie Infinity account. Borrowers must use this account to log in to Axie Infinity to play with their borrowed Axies. Please make sure the email address is not already associated with an Axie Infinity account.
Note that the Axie Infinity account will be associated with a new Ethereum address custodied by AxieTree, not the User’s. Once the Registration is complete, the User may begin to borrow on AxieTree. While Registration is not required for Lenders, anyone who wants to borrow must Register.
Borrowing
Choosing Axies
Borrowers can select up to a maximum of 3 Axies from AxieTree to borrow. Note this costs a little bit of gas (ETH), but having this small upfront cost prevents abuse. Borrowers can then log into Axie Infinity using the credentials from registration to play using the 3 Axies. Because Borrowers do not own the private key of the address holding the Axies, they themselves cannot breed or transfer borrowed Axies.
Borrowers can return Axies and swap them out for other Axies at any time, but this will cost gas (ETH), and may require the Borrower to earn even more SLP to keep the Axies. Details on this below.
When choosing Axies, Borrowers are shown full details about the Axie. They’re also shown details of the borrowing terms — the duration of the rent and the fees associated between the two different types of borrowing: (1) SLP revenue sharing and (2) ETH-based renting.
SLP Revenue Sharing
Aside from the cost of gas, Borrowers are able to borrow Axies for free via the SLP Revenue Sharing model. In this model, Borrowers agree to share their SLP earnings with the Lenders, and the percent of SLP Revenue Share for each Axie is set by the Lender. AxieTree receives a 10% service fee.
For example, suppose a Borrower has a team of 3 Axies with the following fees (25%, 10%, and 30%) earns 1000 SLP with that team. The distribution of SLP rewards would be as follows:
- 100 SLP to AxieTree
- 83.33 SLP to Lender of 25% fee Axie (1000 * (⅓) * 0.25)
- 33.33 SLP to Lender of 10% fee Axie (1000 * (⅓) * 0.10)
- 100 SLP to Lender of 30% fee Axie (1000 * (⅓) * .3)
- 683.34 SLP to the Borrower
ETH-based Borrowing
Borrowers are also able to borrow certain Axies for a fixed period by paying upfront with ETH. As Axie competitive play matures, we imagine a world where specific Axies or Axie types establish a reputation for being amazing fighters. By borrowing Axies with ETH for a fixed time period, the Borrower is entitled to all SLP earnings from that Axie. A 10% service fee to AxieTree applies to the Lender.
For example, the owner of Axia (Axie #265) might lend her out for 1 ETH over 4 weeks. The Borrower would pay 1 ETH, and the Lender would receive 0.9 ETH, while 0.1 ETH is sent to AxieTree. Using the example above, suppose the Borrower switches out the third Axie with Axia. The rewards would look as follows:
- 66.67 SLP to AxieTree
- 83.33 SLP to Lender of 25% fee Axie
- 33.33 SLP to Lender of 10% fee Axie
- 0 SLP to Lender of Axia
- 783.34 SLP to the Borrower
Other Rewards
We envision a future where a team of borrowed Axies may win Axie tournaments. Winnings from tournaments and other events (i.e. AxieTree Leaderboards, to be explained in the “AxieTree Epoch” section below), are kept entirely by the Borrower. Power to the Borrowers!
Returning Axies
A Borrower may return Axies via several methods. First, the Borrower may return the Axie before the maximum borrow period (perhaps switching out an Axie for a better team composition). If the Borrower chooses to return the Axie themselves, the Borrower pays the gas to return the Axie to the Marketplace.
Otherwise, at the end of the borrow period, the Borrower may wait for the AxieTree Worker Bot, which scans the Platform to identify and return any Axies whose borrow period has expired to the Marketplace. The AxieTree Worker Bot will run at the end of the AxieTree Epoch, to be explained further below in the “AxieTree Epoch’’ section.
Lending
Lenders will be able to select multiple Axies to deposit into AxieTree to be available for borrowing in a single transaction. Lenders must pay gas (ETH) to list Axies into the AxieTree marketplace.
Lenders can set the following options on each Axie:
- SLP revenue share or ETH lending fee
Lenders can only choose 1 of the above. As explained before, SLP revenue share is the % fee that the Lender will take for all the SLP earned by the Borrower for this Axie. ETH lending fee is the amount of ETH a Borrower has to pay up-front in order to borrow the Axie. - Maximum duration
This is the maximum amount of time a borrower will be able to hold the Axie before it is forcibly returned back to the Lender or the AxieTree marketplace.
Lenders can edit the fees and duration for each Axie if they’ve already put it into the marketplace and if nobody is currently borrowing it. Note this operation will cost the Lender gas.
Returning Axies
A Lender may return their unborrowed Axies from the Marketplace back into an ETH address they control at any time.
However, for Axies currently being borrowed, Lenders cannot retrieve their Axies until the Axie is released from the Borrower (either by returning, or by the AxieTree Worker Bot). In this case, Lenders will be able to request the Axie be returned directly into their wallet — not back into the marketplace — when the Axie is released.
Security
As mentioned, Axies being borrowed are sitting in EOAs owned by the AxieTree team, as we are providing custodial services. This allows the AxieTree team to move Axies in emergencies, such as bugs in our code. Via this model, we also prevent any borrowers from being able to misuse or run away with the borrowed Axies.
Axies being lent out in the AxieTree marketplace that are not being borrowed are moved by our smart contract to a 3-of-5 multisig owned by the founding team of AxieTree. The AxieTree treasury is also held in a 3-of-5 multisig address.
Preventing Abuse
Multi-accounting is a huge risk that can cause Axies to be banned from the game, a rule set by the Sky Mavis Team’s Terms of Use, which states: “We regularly ban players who break our terms of use https://axieinfinity.com/terms, and for avoidance of doubt : you may only play on one account within any 24-hour period.” Registering for an account via AxieTree while keeping a main Axie Infinity account is perfectly acceptable, but please make sure to adhere to Axie Infinity’s terms and conditions. Just as how traditional Scholarship Programs may find themselves at risk of banned Axies if Scholars engage in more than one Program, Lenders on AxieTree are also exposed to this risk.
However, AxieTree is able to improve significantly from the scholarship model with our ability to cross-reference various data points to identify which users may be trying to abuse not only Axie Infinity’s terms of use, but our own platform. AxieTree employs several tools to ensure that the platform is protected from abuse, such as tracking the IPs of Borrowers and banning Borrowers who use multiple accounts from the same IP. These Borrowers can also be reported to Axie Infinity in the future. However, this is not foolproof and Lenders always bear a risk of having their Axies banned.
The AxieTree team is committed to working together with the Axie Infinity team to ensure a fair experience for all players.
AxieTree Epoch
Again as noted above, due to recent SLP claim period changes from the Axie Infinity team, details of this section is subject to change.
AxieTree is the very first platform in the world of crypto and NFTs that creates an open lending marketplace to facilitate the automation of “play to earn”.
We are introducing the AxieTree Epoch, a time period during which all Borrowers must meet a certain amount of SLP rewards. The AxieTree Epoch incentivizes proper use of the AxieTree platform, as well as creating new opportunities for the entire Axie ecosystem.
The core functionality of AxieTree’s reward distributions, as well as many AxieTree events and promotions, will be centered around AxieTree Epochs. Traditionally, players must sync their earned SLPs on-chain into their own ETH addresses, which costs gas. AxieTree distributes SLP rewards at no cost to its users through the incentives introduced by the AxieTree Epoch.
Every Borrower’s SLP earnings are tracked throughout each AxieTree Epoch. For example, the standard AxieTree Epoch will be 3 days, where each Borrower must earn 150 SLPs during that period. At the end of each epoch, the SLP requirements count and countdown are reset.
Borrowers who have not met the SLP requirements will have their account “liquidated”, whereby all borrowed Axies are returned to the AxieTree Marketplace or Lenders, and any earned SLP is split between the Lender and AxieTree. Borrowers who continue to have their Axies returned to the Marketplace for failing to meet SLP requirements may be banned from future use of the platform. This ensures proper incentives at play for both Borrowers and Lenders. Borrowers cannot simply sit on borrowed Axies, and Lenders are able to expect a baseline level of participation from Borrowers. Important note: Axies borrowed for ETH are not subject to SLP earnings requirements set each AxieTree Epoch. All SLP earned by Axies borrowed for ETH go directly to the Borrower.
Borrowers who meet the SLP requirement will see their SLPs distributed into their own ETH addresses, and their SLP counter for the next Epoch will reset to 0.
A global countdown per epoch will be clearly visible on each page of the platform. Users of AxieTree are expected to operate with AxieTree Epoch periods in mind. For example, a Borrower borrowing Axies with only 24 hours remaining in the Epoch period should be mindful of the 150 SLP requirement.
As noted, returning an Axie resets your SLP counter. Depending on the composition of your Axie teams, the implications differ and Borrowers should keep the following considerations in mind. At the end of each AxieTree Epoch:
Suppose a Borrower has 1 SLP-rent Axie, 2 ETH-rent Axies, and earns 100 SLPs by end of epoch:
- Only the SLP-rent Axie is returned, and because the 150 SLP requirement has not been met, their earned SLP balance drops to 0
Suppose a Borrower has 1 SLP-rent Axie, 2 ETH-rent Axies, and earns 150 SLPs by end of epoch:
- All 150 SLPs are counted toward the SLP requirement. Since the Borrower has met the requirement, the SLPs are counted toward their earned SLP, and the Axies stay in the Borrower’s account.
On the other hand, suppose a Borrower has 3 SLP-rent Axies, earns 100 SLP, and returns 1 Axie before the end of an epoch:
- Only the 33 SLP for that 1 axie are distributed, keeping their SLP counter at 67
As noted above, due to the changes on SLP claim periods from Axie Infinity, we’ll be sharing more details about how users will be able to claim SLPs on AxieTree in a future post.
Details of the Alpha Launch
Now we get to the most exciting part of this post — AxieTree’s Alpha launch!
Date
Starting today — December 25th, 2020. Merry Christmas!
Phased Launch
The alpha launch will be marked by phases to ensure a safe and successful launch. Because redeploying our smart contracts requires all Axies to be returned to the Lenders, we are carefully phasing each step of the launch.
On December 25th, the founding team will be the only Lenders, and the first 5 borrowers will be our Community Partners. After close monitoring of platform by the 5 Community Partners’ use over the following days, we will open up registration for Borrowers to the winners of the first 25 alpha spots.
Following those 25 Borrowers, we will gradually add more Borrowers from our raffle, until we hit 100 Borrowers.
100 Public Alpha Borrowers
We are hosting a raffle for the community to participate as our first 100 public alpha borrowers. Please enter the raffle here: https://gleam.io/EzznH/axietree-alpha-raffle
On December 25th, we’ll release our platform and announce the first 25 participants from the raffle. More will be announced over time; the raffle will close on January 8th (John’s bday 🥳).
Whitelisted Lenders
Due to the higher risk for lenders in this alpha launch, we are keeping this closed to the founding team initially, and then to our highly respected and trusted Community Partners. We hope to open up Lending spots to more community members for our Beta launch.
Thanks for reading, and we look forward to all the players on AxieTree!
With much love,
AxieTree team
AxieTree — a community project created by Axie players, for Axie players.
Disclaimer: This is not an official Axie Infinity service. AxieTree is not affiliated with Sky Mavis or any of its subsidiaries, including “Axie Infinity.”
