The Ultimate Guide to Ronin Network (RON) (Gem or Not?)

The Ronin network is an Ethereum-linked sidechain that was created specifically for blockchain games. It is backed by Sky Mavis, the gaming studio behind popular blockchain game Axie Infinity. Ronin’s goal is to make Axie Infinity and future gaming releases more economical, faster, and seamless.

The Ronin network has been garnering attention, with many investors wondering if the project is still undervalued. With hundreds of millions of deposited assets and over 2 million wallet downloads, a conversation about whether Ronin is a gem or not, is in order.

To better understand what the Ronin network is all about and whether it is profitable to invest in the project, it would be best to get down to the basics and roots of the Ronin network. This article provides a comprehensive guide to the Ronin network to assist you in determining whether RON is a good investment or not.

This beginner guide to Ronin Network covers the following:

What is the Ronin Network?

Launched in the first half of 2021 by Sky Mavis, the Ronin network is an Ethereum sidechain designed to host blockchain-based gaming applications.  The network was launched in response to growing demand for Axie Infinity’s game and the high gas fees and slow settlement times make Axie Infinity games more economical, faster, and seamless.

The network’s Testnet was first released on December 23rd, 2020 and a few months later, precisely on the 1st of February 2021, the Ronin Mainnet was launched.

With its root in Japanese culture, the word Ronin was used to describe a samurai warrior in feudal Japan who has either lost his master, lord, or daimyo’s favor or lost the master in death. It also meant a samurai warrior whose master had fallen from power.  The online game company used the word “Ronin” to represent Axie’s desire to truly own its product instead of relying on third-party infrastructure.

How Does the Ronin Network Work?

Most blockchain networks usually make use of either the Proof-of-Work (PoW) or Proof-of-Stake (PoS) consensus mechanism to process transactions and create new blocks in a blockchain.

However, the Ronin network uses an upgraded version of the PoS mechanism known as Proof-of-Authority (PoA). While the PoS mechanism can take up to 128 validators, the PoA can only take less than 25. These validators are in charge of creating and validating blocks on Ronin, updating price oracles, approving transactions from the deposits, and transfer of assets like ETH, ERC20, and ERC721 by clients to and from Ronin.

Ronin Network Validators

Having the sole authority to choose validators in the meantime, Sky Mavis has enlisted officials from gaming, crypto, and NFT space as Ronin Network validators. The following prominent firms are shortlisted:

  • Binance
  • Animoca Brands
  • Sparq Ventures
  • Ubisoft
  • Dapp.com,
  • NFT Bulwark
  • Nonfungible.com, etc. 

What is the Ronin Token?

Ronin token or RON token is the native or governance token of the Ronin network. RON token is an ERC-20 token with integration on Ethereum Virtual Machine (EVM). In January this year, Axie Infinity launched this native token

At the time of writing, the token was trading at $1.78 with a market cap of over $263 million and an available supply of over 148 million RON tokens. According to Sky Mavis, the newly issued tokens will aid in the security and decentralization of the network, as well as allow users to pay for transactions on the Ronin network.

To celebrate the launch of the token, users, both old and new, were given benefits and bonuses in the form of free transactions. The market was also opened for the just released RON token with the company launching a RON/ETH liquidity pool on Katana, Ronin’s in-house decentralized exchange.

The Connection Between Axie Infinity and Ronin Network

As mentioned at the onset of this article, the Ronin network is related to the Axie Infinity game. You might wonder, what relationship does the online game have with the Ethereum side chain network?

Axie Infinity is an NFT-based online video game with Pokemon lookalike creatures known as Axies.  Players in the game are focused on collecting and minting NFTs which represent the Axies creatures. 

The creatures are bred to battle against other Axies within the game. Players also work toward building kingdoms for their Axies. To reward players for the labor of breeding more Axies or trading in the marketplace, a user can earn Smooth Love Potions (SLP).

The peculiarity of Axie Infinity from other online video games is its ability to connect the gaming world to the blockchain field. At Axies Infinity, players can own their virtual assets and also earn ERC-20 tokens, or SLP,  as a reward for getting to an advanced level of skill.

Due to the popularity of the Axies Infinity, the game has grown to become the most-played blockchain game recently. It was loved by many that some gaming enthusiasts were willing to pay huge amounts to own in-game assets.

In November, the game recorded the most expensive Axie land sale which cost about 550 ETH (worth more than $2.3 million). In February 2022, the total value of NFTs sold in Axie Infinity crossed the $4 billion mark for the first time.

Why Axie Infinity Launched the Ronin Network

Initially, Axie was built on the Ethereum network, however, due to the network’s signature high gas fees and terrible network congestion, the online game had to seek measures to make transactions cheaper and easier in order to maintain the user base. 

In the quest for an alternative, Axie incorporated the Loom Network, an Ethereum token used to power a network of delegated side chains that uses the proof of stake mechanism. 

However, when the network’s CEO Matthew Campbell stepped down from his role in February 2020, Vadim Macagon took over and Loom shifted its focus from user-facing applications to enterprise solutions, causing the company to almost fold up. The change caused Axie to search for another sidechain.

Fast forward to February 2021, the Ronin network was created as a second solution. To improve the user experience, Ronin initially focused on blockchain efficiency. After some time of introducing the sidechain to Axie games, Sky Mavis testifies that the Ronin network offers fast & seamless transactions that are confirmed almost instantly. The gas fees, which are very low compared to that of the Ethereum network, are stored and given out as tournaments & bounties rather than paid to the miners. 

Players can use the Ronin network to withdraw and transfer Axie assets without limitation. In fact, all Ronin users are allowed to make 100 free transactions in a day, different from the Ethereum-based decentralized exchange services that can cost up to $10 for one transaction.

What is Katana DEX?

Katana DEX, also known as “Ronin DEX”, is a platform where users can easily swap tokens within the Axie Infinity ecosystem without leaving the Ronin blockchain. With over 132,000 users and over $200 million in total value locked (TVL), Katana DEX is the largest exchange for Axie ecosystem’s tokens. 

Katana (The Ronin DEX)

As Ethereum has Uniswap, Matic has Quickswap, the Ronin blockchain has Katana DEX as its own flagship decentralized exchange. By using Katana, Axis users will be able to swap assets quickly, at any time, and anywhere on the Ronin blockchain at a low cost. 

With Katana DEX, users do not have to rely on other decentralized exchanges and do not need to transfer assets out of the Axies ecosystem, thus reducing the friction when swapping between Axie’s tokens. Presently, Katana DEX supports the tokens, Smooth Love Potion (SLP), Axie Infinity Shards (AXS), Wrapped Ethereum (WETH), and USDC.

Main Features of the Katana DEX 

While there are many facets to the Katana DEX, the exchange has four main features that include:

Swap: On the platform, users can exchange or buy tokens at a very low fee by connecting their Ronin wallets first. Then, they buy ETH to finally swap it to get the supported $RON tokens.

Staking Pool: Katana has about four staking pools (AXS/ETH, SLP/ETH, ETH/USD, and CRON/ETH) where users who opt to become Liquidity Providers (LP) can deposit their tokens as collateral to earn about 0.25% of each trade that utilizes the pool.

In addition, 10% of the total RON supply is rewarded to LPs over a 90 day period to encourage them, increasing the distribution of the RON tokens to the Axie community. With the acquired tokens, LPs can also use them to farm for greater yields.

Farm: After staking, LPs can deposit the LP tokens they have earned into various pools to farm $RON tokens.

Analytics: This informative section of the Katana DEX provides details on liquidity, 24-hour trading volume, and price of the 5 supported tokens (WETH, RON, SLP, AXS, and USDC). Information on the top pairs and transactions are displayed here too.

What is Ronin Wallet?

The Ronin Wallet is the primary wallet used for the Ronin network. It is where the standard tokens RON, RRC20 & RRC721 are kept in the blockchain platform. The wallet is available as a chrome extension for desktop and as an app on mobile devices. 

With the Ronin wallet, users can exchange standard tokens and access the popular game Axie Infinity along with other decentralized applications (DApp) running on the Ronin platform. Users can also send and receive cryptocurrencies and NFTs without paying high gas fees. 

The ERC-20 tokens supported by the Ronin Wallet include Ronin Wrapped Ether (WETH), Smooth Love Portion (SLP), Axie Infinity Shard (AXS), USDC, Axie Egg Coin (AEC), SLP-WETH, RON-WETH, and USDC-WETH. While the ERC-721 tokens supported on the wallet include Land Plot, Land Item, and Axie. 

The Ronin wallet is a non-custodial wallet that allows only the owner of the wallet to have absolute influence and access to the funds in the wallet. Unfortunately, this feature makes it impossible for the user to retrieve the funds in the wallet if the seed phrase or private keys are lost, stolen, or destroyed. Not even Ronin developers can help that user to recover the wallet. 

Like most crypto wallets, the Ronin Wallet has 3 extremely important features to note:

  1. The wallet address, which consists of numbers and characters used to send and receive assets between two wallets.
  2. The passphrase, which is a security key likened to a password. The passphrase consists of any 12 English keywords and is required to perform the wallet recovery operation.
  3. The private key is a string format to connect to a crypto account, similar to the password of a bank account.

How to Get Ronin (RON) Token

You can get Ronin (RON) tokens by using the SWAP option on Katana DEX or buying from supported cryptocurrency exchange platforms like Gate.io, OKX, HOO, AEX, Korbit, CoinW, and Jubi using stablecoins like USDT or KRW.

Ronin Token Use Cases

The RON token can be used for the following:

  1. Facilitation of all transactions on the Ronin blockchain.
  2. Governance of the Ronin community.
  3. Staking through validators to earn rewards on Ronin

Ronin Network Hack

On March 29, 2022, the Ronin Network suffered a security breach that led to the loss of over $600 million. The hack was possible because Sky Mavis retained control of the majority of validator nodes required to authorize withdrawals from the Ronin Network bridge. The team identified the incident six days after the original hack, and has pledged to resolve the problem by further decentralizing validator roles on the network.

Read More: Ronin Network suffers $625 million security exploit

Frequently Asked Questions About Ronin Network

Is Ronin (RON) Worth Investing in? Gem or Not?

For a token to be worth an investor’s fund, it must meet the needs of that investor and overall be making good progress. It is the personal decision of an investor to examine a particular token and decide on whether to invest in it or not.

However, the Ronin network since its launch date has made considerable progress. From March 2021 to October 2021, deposits on the Ronin Network went from $1 million to $5 billion, about 5000 times its previous value. Its daily active users (DAU) also increased from 428,000 in October to nearly 1 million in November 2021.

What is the Future of the Ronin Network?

In the same month the Ronin blockchain flagship DEX, Katana DEX, was launched, it surpassed some prominent DeFi DEX like Raydium, Uniswap V3, and Sushiswap on November, 12th 2021. With Ronin and its DEX making good progress, the future is most likely bright for the network. 

Source: DappRadar

 

Giving more insight into what the Ronin network will offer in the future, Trung Nguyen, the CEO of Sky Mavis said,

We are very excited about the possibilities Ronin brings. Though it’s still in an early state, Ronin will continuously evolve over the years to serve the spirit and ethos of blockchain gaming. On the technical side, we are also looking into various solutions to further strengthen and scale Ronin. zKSyncs, for example, is looking promising, but it could take time until it’s production-ready — particularly for NFTs and games.”

Conclusion

If you ever asked what is Ronin Network, then you probably have found the answer in this article. This beginner guide to the Ronin network explains the different features of the project as well as the most popular questions around its primary backer, Axie Infinity.

Is Ronin a good investment? The information considered in this article as well as further independent research can lead you to the right conclusion. to do further research and decide on whether to consider RON as a gem or not. The early age of the Ronin network means it still has a long way to go, but with the progress it has made so far, will the network capture more of the blockchain gaming industry? Only time will tell!

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