Your first Iron Knife Token allows you to enter the Underground Leagues of Knife and Candle, provided your Dangerous is high enough (50 I believe). Simply request a spare token on the forum and it will be sent to you. That said, you will first enter the Iron Leagues. In this League, people can attack you at any interval when your name comes up - the attack will either work or fail. If the latter then you win an Iron Knife Token and a Prize Token if they had one.
Lose all your Iron Knife Tokens and you are kicked out of the Leagues (though you keep any remaining Prize Tokens you had). You will receive a regular delivery of 3 Iron Knife Tokens every week, so just wait until you are comfortable before attacking. You are immune to attack if you choose to go without a form, which is an option when you are choosing to change your form. This only appears when a fight is over or when another opportunity arises. There are many cards (such as the ones for fourth tier lodgings) that allow you to change your form when you wish to.
The Moon League is above the Iron League, and far more docile. Send a challenge to a player, and if they accept then you will rotate between turns preparing for your attack and defense. The game is over when an attack is launched.
Prize Tokens are used to buy items in the Gamekeepers Cottage (the headquarters of the game), and the Proud Parade of Victories that are accumulated after successive victories are used to acquire patronage and elevate your ranking to purchase mildly effective head-wear in the form of medals. Note that all your Parade of Victories points are lost when you lose a fight or spend it on anything.
edited by Owen Wulf on 1/3/2014