TL;DR
- Axie converts treasury ETH into liquid staking derivatives.
- New delegation feature increases voter participation with safeguards.
- A 10% voting power cap prevents governance centralization.
Axie Infinity activated AIP-003 and a Voting Delegation feature in November 2025, seeking to convert part of its treasury into recurring revenue and to facilitate participation by AXS holders. AIP-003 proposes to mobilize 2.829 ETH towards liquid staking schemes, while delegation aims to increase representativeness with safeguards against concentration of power. The combined approach targets sustainable funding and more inclusive governance within the Axie ecosystem.
AIP-003 authorizes the deployment of 2.829 ETH from Axie’s treasury into liquid staking derivatives such as wstETH (Lido), rETH (Rocket Pool) and cbETH (Coinbase). Liquid staking is a mechanism that tokenizes the rights to staking returns without locking up the liquidity of the assets, allowing the treasury to remain flexible while earning yield.
With an estimated APY of 2,4% annually, the initiative projects generating around 67 ETH per year — approximately $200k — intended to finance development, community initiatives and possible rewards to AXS stakers.
Operational impact for treasuries and institutions includes reducing the opportunity cost of idle assets and creating predictable income; however, it implies dependence on the liquidity of staking derivative markets and on the selected custodian protocols.
Voting Delegation: participation with limits
The new Voting Delegation feature in App.axie allows AXS holders to delegate their voting power to chosen representatives. The tool seeks to convert inactivity into informed representation and to improve decision quality by concentrating analysis in specialized delegates. Vote delegation is the act of temporarily transferring the right to vote to another actor who acts on behalf of the holder, enabling broader participation without requiring every holder to engage directly with each proposal.
To mitigate centralization risks, AIP-003 incorporates a voting power cap of 10% per Lunacian and requires a 66% supermajority for approval of the AIP itself. In addition, any subsequent changes to the staked ETH will require new AIPs with a community mandate, preserving collective control over the funds. These restrictions aim to prevent governance capture by large holders and to raise the consensus threshold for high-impact decisions, balancing efficiency with safeguards.
For traders and risk managers, the staking strategy can affect the effective supply of ETH in the Axie ecosystem and modify market signals linked to the liquidity premium, while the governance structure will influence the speed and direction of future decisions on issuance, listings or partnerships.
AIP-003 and Voting Delegation represent a pragmatic attempt to convert reserves into sustainable revenue and to increase participation through delegated representation, with controls designed to limit centralization.
