Planning to indulge in SLP staking? You may want to examine this data first…
- SLP saw the largest spike in volume in 2023 on 9 April
- However, SLP’s bullish performance was cut short towards the end of the week to make way for the bears
SLP staking gained steam at the height of the previous bull run but it is barely talked about, just as is the case with Axie Infinity. However, the latter has been focused on expanding and remaining relevant, but what does the future hold?
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Before we get into SLP staking, perhaps it is worth looking at the mechanism behind it. This is important because it offers a deeper understanding of why Smooth Love Potion (SLP) is an important part of the Axie Infinity ecosystem.
Axie Infinity developed SLP as the token used to breed in-game characters called Axies. These characters are then used in the game. In other words, the demand for SLP occurs when users need to breed in-game characters that have specific traits.
So why is SLP staking important? Well, this is because Axie Infinity ecosystem users need access to the SLP token within the DeFi environment. SLP was initially only available in the Axie Infinity ecosystem.
However, it became more widely available after it was launched on the Uniswap decentralized exchange. Since then it has become available on multiple crypto exchanges including the centralized ones. The implication is that SLP is now more easily accessible than ever before. More so, SLP is now available for trading in the retail market which makes it more volatile price-wise.
Is SLP staking still possible?
Yes, SLP staking is still possible on decentralized platforms. This is because some DeFi platforms require liquidity. As such, SLP holders can stake their tokens on liquidity pools to earn passive income.
But, rather than looking at whether SLP staking is possible, holders of the token should consider whether it is still profitable. The answer to this question depends largely on the level of demand in the market.
SLP staking profitability depends on the level of demand for the token in the Axie Infinity ecosystem as well as the retail market. Unfortunately, the exposure to the retail trading segment made SLP more susceptible to price volatility. As such, its value was negatively impacted during the 2022 crypto winter during which it lost a significant chunk of its value.
SLP’s market cap peaked at $255.4 million in 2021 but it experienced significant outflows since then. At the time of writing, it had a $91.9 million market cap, thus highlighting the level of outflows that it has experienced since then.
Despite the outflows in the last two years, whales have been accumulating the token. The supply held by top addresses has been on the rise during this period and recently reached its highest historic level in April.
The fact that whales have been accumulating SLP during crypto winter was a good sign for any holders concerned about its future. In addition, the Axie Infinity ecosystem was still growing, hence there will still be demand for SLP, especially during the next major bull run.
But the real question is whether the Axie Infinity can pull off a double whammy and attract as much attention as it did during the previous major rally.
SLP’s price action
While it remains to be seen whether we will see another major hype event for the Axie Infinity ecosystem, SLP’s performance was worth noting. For example, it registered a healthy at the start of 2023, as did most top cryptocurrencies.
This confirmed that SLP can still command healthy bullish volumes. Speaking of volume, SLP’s largest spike in the last three months occurred on 9 April.
At its three-month high the volume peaked at 159.95 million SLP. However, it has since tanked and the market hovered slightly below 8 million SLP at the time of writing. But what about the price action?
Read SLP’s price prediction for 2023-24
Although SLP pulled off a bullish performance at the start of the week, its upside was cut short towards the end of the week. It has given up a significant amount of its YTD gains and was closing in on its historic low. SLP traded at $0.00216.
The discounted price represented yet another opportunity for anyone looking to get into SLP staking because they can buy more. However, there is still a significant degree of uncertainty regarding its future.