A look at Ronin - The Engine Powering Axie Infinity's Growth

In the last couple of years, blockchain games has grown in popularity and is currently one of the hottest trends around. Axie Infinity is without a doubt one of the most popular games that have gained fans from all around the world. For a game like that to be seamless and enjoyable for users, it typically requires fast and cheap transactions to scale, as well as the facilitation of thousands, if not millions, of micro-transactions every day.

Unfortunately, this is not the case with Ethereum’s blockchain, where transactions can cost anywhere from $50-$100, and processing speeds are measured in minutes instead of seconds. These drawbacks limited Axie Infinity’s ability to attract new players and retain existing ones. Spikes in gas fees and network congestion would slow the game’s economy and undo any traction the game was getting. Things had to change if the game had to grow and cater to millions of players, which was why the team behind Axie Infinity launched the Ronin mainnet last February.

What Is Ronin?

Ronin is an Ethereum sidechain created with Axie’s community in mind. Sky Mavis, the team behind the game, needed a reliable, fast, and cheap network that could cater to the demands of the game. Ronin was the answer – a scaling solution that put gaming first, built to withstand the test of time, and the ever-increasing demands of a fast-growing game.

Sidechains represent one of the main Layer-2 scaling solutions on Ethereum that allows for more efficient transaction processing. As a sidechain, Ronin is compatible with Ethereum, though it is an independent blockchain that runs parallel to the Ethereum mainnet while having its own consensus model block parameters.

Ronin currently adopts a Proof-of-Authority (PoA) consensus model, a reputation-based system that allows for fast transactions due to its limited number of validators and relatively centralized nature. Validators are handpicked by the team based on their credibility, and unlike Proof-of-Stake blockchains, validators “stake” their reputation instead of tokens. Validators risk losing their reputation if they become bad actors or negatively affect the network. Some examples of validators for the Ronin network include Binance, Ubisoft, and Animoca Brands.

Why the Axie Team Created Their Own Chain?

Before Ronin was built, the Axie team had partnered with Loom network, which serves as an alternative layer-2 scaling solution. However, after about a year, the Loom team decided to optimize their network for enterprise solutions instead. This created a misalignment of goals between the two teams, and Sky Mavis decided to end the partnership.

Therefore, by creating their own blockchain, they would prevent a similar situation from occurring in the future. Since most layer-2 solutions that exist today are built with DeFi and payments in mind instead of gaming, the team was able to design and decide on the chain's characteristics by creating their own blockchain.

The Sidechain’s Properties

Ronin Wallet

#What is Ronin Wallet?

Given that a good crypto wallet is crucial for creating a seamless user experience when interacting with a blockchain, the Axie team created their own wallet. This was achieved by partnering with Ronin to allow users to purchase Axie’s ecosystem tokens directly using fiat. Ronin wallet allows users to have custody over their Axie-related assets and is available on desktop and mobile devices. Currently, the wallet sees over 300,000 daily active addresses, with this figure peaking at 1.1 million last November.

Transactions and Gas Fees

The Ronin sidechain was built to be an industry-leading blockchain for gaming. It is optimized for near-instant transactions and negligible fees, allowing for millions of in-game micro-transactions to occur seamlessly. The network is the backbone of Axie Infinity and powers all its transactions. It also holds all its assets such as Axies, Land, SLP, AXS, Wrapped ETH (WETH), etc. At its peak back in November last year, the sidechain processed over 560% of the total transactions on Ethereum with an average block time of 3 seconds. Trades on the Axie marketplace and transactions over the network were usually completed within seconds.

Transactions on the Ronin sidechain also had negligible gas fees. Compare this to Ethereum, where the fees hover between 50-100 gwei, thereby making micro-transactions uneconomical. On the other hand, Ronin offers 100 free transactions per wallet each day. In the future, there will be a small fee once the $RON token is released, but it should cost less than $1.

Katana – Ronin Decentralized Exchange (DEX)

It is common for a blockchain to have its own flagship DEX that allows users to swap tokens freely within the ecosystem. For example, Ethereum has Uniswap, Matic has Quickswap, and Ronin has Katana. The DEX allows users to easily swap between tokens within the Axie Infinity ecosystem without leaving the Ronin blockchain. This reduces the need to bridge assets out of the ecosystem, and reduces friction when swapping between Axie’s tokens.

In summary, the birth of Ronin has ushered in the rise of Axie Infinity and the GameFi/Play-to-earn wave. As it is, time will tell if the sidechain will ultimately become the go-to blockchain for gaming.