Ronin (RON) is the first blockchain created for the gaming metaverse

Many blockchain games were made on the Ethereum blockchain. Still, the high cost of commissions and long transaction confirmation times did not encourage the mass adoption of decentralized gaming applications.

Because of this, some developers started to move their games to other, faster, and more cost-effective blockchains, and some even started to create their own.

What is Ronin?

The Ronin network is an Ethereum sidechain created by Sky Mavis studio specifically for Axie Infinity, a blockchain game popular in the crypto industry. The development of Ronin's blockchain was motivated by expensive and slow transactions on the Ethereum network, which negatively impacted the gameplay and alienated some users. On the Ronin network, the average transaction fee is about $0.0013 — more than 500 times less than the average Ethereum fee.

The Ronin blockchain concept was introduced in the second half of 2020, just as DeFi and GameFi were gaining momentum, and the developers released a testnet at the end of the year. Ronin's leading network was launched in February 2021. Thanks to the popularity of the Axie Infinity blockchain game, the Ronin project reached 2 million downloads of the wallet application quickly.

Note that the Sky Mavis team initially planned not to develop their network but to use the existing blockchain solution Loom Network. However, the creators of Loom Network focused on developing corporate solutions rather than user applications. Therefore, Sky Mavis developers eventually started working on creating their blockchain.

In 2022, the Ronin bridge, which held most of the protocol's liquidity, suffered a $540 million hack at the exchange rate. Many of the affected users were Axie Infinity players. After an investigation, it turned out that the hack was a mistake by a Sky Mavis employee who downloaded a malicious file disguised as a job offer. Only after the bridge hack did CertiK conduct a security audit of the protocol.

The incident forced the Sky Mavis team to suspend the bridge for Ronin, but it resumed three months after CertiK completed an audit. According to public sources, the team could only recover some of the stolen capital. Despite the incident, the platform continues to exist among significant projects.

How does the Ronin network work?

The blockchain itself does not represent any unique technology, and the sole purpose of its development was to present Axie Infinity players with a productive decentralized network with fast and cheap transactions to attract as many users as possible.

Apparently, it really worked: at the peak of its popularity in 2021, the number of active Axie Infinity users exceeded 700,000 and, according to some reports, could even cross the 1 million mark.

The Ronin network operates based on Proof-of-Authority consensus, which tends to have a more limited set of transaction validators and block miners than the Proof-of-Stake algorithm. Unlike the latter, the PoA algorithm is a modified version of Proof-of-Stake, in which nodes obtain the right to validate blocks through reputation rather than staking. In other words, in PoS networks, any node that contributes enough native cryptocurrency to the staking can become a validator, while PoA blockchains require a kind of "reputation census."

In the early stages of the project's development, the Sky Mavis team had the sole right to choose the validators of the network, and they were:

• Binance,
• Unisoft,
• Animoca Brands and other major companies.

However, other nodes could then get the right to validate, provided they passed the censor threshold.

The Ronin blockchain is compatible with the Ethereum Virtual Machine (EVM) and uses price oracles to exchange data with other blockchains. With EVM compatibility, users can seamlessly transfer tokens between the Ethereum and Ronin networks.

Ronin ecosystem

Ronin does not boast of a developed ecosystem even when compared to Tier-2 small-cap projects such as:

• Moonbeam,
• Wemix,
• Enjin Coin and others.

However, despite this, Ronin is among the top five most significant GameFi-focused projects in capitalization, only slightly behind The Sandbox and Axie Infinity.

According to DeFi Llama, only 3 DeFi protocols exist in the Ronin ecosystem. Still, the only one worth noting is the decentralized exchange Katana DEX, which has over $170 million in blockchain assets (TVL). Katana is essentially a native DEX exchange on the Ronin network and was created to provide liquidity to Axie Infinity's native GameFi tokens, such as AXS and Smooth Love Potion (SLP).

RON token

Like most networks, apart from some second-tier blockchains, Ronin has its native cryptocurrency, RON, used for transaction fees and transfers within the network.

The total amount of cryptocurrency is 1 billion RON. Of these, less than 30% — about 292 million RON — are traded on the market as of January 2024. However, the RON cryptocurrency has no maximum issuance and is inflationary.

According to the official tokenization of the project, 55% of all tokens are allocated for community rewards and incentives:

• staking,
• liquidity mining,
• content creation,
• grant programs,
• hackathons.

Regarding capitalization, RON is among the top 100 cryptocurrencies according to the CoinMarketCap rating, and the project's capitalization reached almost $1 billion.

Ronin's prospects

The ecosystem of the Ronin project is closely linked to the blockchain game Axie Infinity, as well as the demand for the DEX exchange Katana, so in many ways, its prospects, we can say, depend on their success.

According to the Ronin project's official website, more than 14.6 million addresses have been registered in this network, and the number is growing quite rapidly — these and other data can be tracked in real-time.