What is the potential of Ronin after Axie Infinity?

Author: stella@footprint.network

Data Source: Ronin Dashboard

The popular Web3 game Pixels migrated from Polygon to the game-specific blockchain Ronin in late October 2023. Previously, Pixels was the most active Web3 game on Polygon in terms of active users (wallets). Its migration to Ronin has injected strong momentum into the latter's recovery following the hacking incident in March 2022.

Since the migration, on-chain activity on Ronin has seen significant growth in November. While Ronin previously relied heavily on the "play-to-earn" game Axie Infinity, its recent resurgence appears to be different from before. We will analyze Ronin's recent data performance and explore its current development status.

Introduction to Ronin

Although Ethereum's architecture is revolutionary, it has not been optimized for the high-speed and low-cost transaction needs of gaming. In 2021, this limitation became a bottleneck for the growth and player retention of Axie Infinity. To address these challenges, the Vietnamese studio Sky Mavis, which launched Axie Infinity, took decisive action and launched Ronin in February 2021.

Ronin is an Ethereum sidechain that is meticulously designed to meet the needs of the gaming industry. Its goal is to provide a powerful, fast, and economical platform to drive the development of gaming applications. This strategic move aims to eliminate the barriers that previously affected the gaming experience and transaction fluidity of Axie Infinity.

Sky Mavis has become a significant force in the Web3 gaming space and is one of the few teams that have truly achieved large-scale adoption of Web3 games. According to data from Footprint Analytics as of November 2023, Axie Infinity has accumulated an astonishing 9.88 million users, with 9.22 million users attributed to Ronin, accounting for 93.3%. The success of this flagship game has provided Sky Mavis with profound insights and valuable experience in the development and operation of Web3 games.

Nearly three years after its launch, Ronin has established itself in the Web3 gaming space. However, whether it has become the preferred blockchain for Web3 games remains to be seen.

Advantages of Ronin

Ronin has demonstrated its ability to scale individual games, such as supporting millions of users for Axie Infinity. Through Axie Infinity, Sky Mavis has gained valuable experience in product development, community engagement, and market expansion. This experience is highly beneficial for partners looking to launch projects on the Ronin network.

Ronin can support near-instant transactions with extremely low fees, effectively and seamlessly facilitating a large number of in-game transactions.

In March 2022, Ronin suffered a major security breach, with hackers stealing 173,600 ETH and 25.5 million USDC. Following this, Sky Mavis strengthened its security measures by adopting a zero-trust framework. Initially, Ronin used a Proof of Authority (PoA) consensus mechanism, relying on a selected group of trusted validators for transaction verification, which was relatively efficient but less decentralized. To enhance decentralization, Ronin transitioned to a Delegated Proof of Stake (DPoS) system, allowing token holders to delegate and elect validators, thereby more fairly decentralizing network control.

Ronin's Ecosystem

The gaming industry occupies the most important position in the Ronin ecosystem. Currently, there are eight running games on Ronin, namely Axie Infinity, The Machines Arena, Bowled, Battle Bears Heroes, Wild Forest, Apeiron, and the recently added Pixels and Zoids Wild Arena. Additionally, two games, Axie Champions and Tribesters, are set to launch on Ronin soon.

As of November, the two games Axie Infinity and Pixels accounted for over half of Ronin's daily transaction volume and nearly 90% of daily active users (DAU). This concentration of user engagement in a few games also highlights the potential vulnerability within the Ronin ecosystem.

Ronin currently holds a 21.2% share of the transaction volume in public chain games. This indicates that, despite Ronin's focus on gaming, there is still room for improvement in its market presence. To gain a competitive edge in the public chain space, Ronin needs to adopt a multi-domain development strategy and further develop its gaming ecosystem.

Data Source: Monthly Volume Distribution

In light of this, Sky Mavis is actively taking steps to expand Ronin's appeal and further develop its gaming ecosystem. On November 2, Sky Mavis announced a strategic partnership with South Korean game studio ACT Games, marking an important step in this direction. This collaboration will bring all of ACT's games into the Ronin ecosystem, starting with the blockchain card game Zoids Wild Arena. This move is expected to accelerate the growth of games on Ronin and increase interest from developers and users in the platform.

In addition to games, Ronin currently has 23 decentralized applications (dApps) running on the platform. These include Katana (Ronin's native DEX), Ronin Wallet, and Mavis Market (NFT marketplace). As of November 30, Katana's Total Value Locked (TVL) reached $92.8 million, but other dApps still have significant room for improvement in user acquisition and engagement.

The Ronin Name Service (RNS) launched its public sale on November 15, 2023, changing the way users interact with the Ronin chain. RNS replaces complex wallet addresses with intuitive, easy-to-read names, making transactions simpler and more accurate. Additionally, RNS will be integrated across the entire Sky Mavis ecosystem, including App.Axie, Mavis Market, and future platforms, optimizing the overall user experience of the network.

Source: Ronin Name Service (RNS)

Data Performance of Ronin

Let’s explore the latest developments in the Ronin ecosystem through data.

• Daily Active Users (DAU)

From July to October 2023, Ronin's daily active user count (DAU, calculated by unique wallets) remained stable at an average of about 17,400. However, with the migration of Pixels from Polygon to Ronin, Ronin's DAU saw a significant increase in November 2023. The number surged from 17,400 to 88,400, peaking at 152,800 on November 22. Notably, Ronin's DAU surpassed the 100,000 mark on November 16 and continued to rise thereafter.

Data Source: Ronin Chain Daily Users

• Daily Transaction Count

From July to October 2023, Ronin's daily transaction count remained relatively stable, averaging about 95,200 transactions per day. Starting from mid-October, Ronin's transaction activity noticeably increased. By November 30, the daily transaction volume had surged to approximately 232,600 transactions.

As the number of transactions increased, the average transaction fee on Ronin has been decreasing. From July to October 2023, the average transaction fee was 0.0022 RON. In November, the average transaction fee dropped to 0.0019 RON, a decrease of 11.7%.

Data Source: Ronin Chain Daily Transactions & Avg. Transaction Fee

• Total Value Locked (TVL)

This year, bearish sentiment has prevailed in the crypto market. Ronin's TVL has shown a downward trend since January. However, since mid-October, with favorable trends in the overall cryptocurrency market and increased user activity in the gaming sector, Ronin's TVL has significantly grown, rising from $49 million to $92.8 million as of November 30, an increase of 86.3%.

Data Source: Ronin DeFi Data

However, Ronin's native DEX Katana accounts for nearly all of the chain's TVL. While the gaming sector has been thriving, there is still room for improvement and growth in other ecological areas on Ronin.

Data Performance of Games

• Daily Active Users (DAU)

Data from Footprint Analytics shows that since July 2023, over 80% of DAU on Ronin comes from the gaming sector.

Data Source: Daily Active Users - Ronin Chain & Game

The DAU in the gaming sector on Ronin aligns with its overall trend. With the addition of Pixels in November, there was a significant increase in DAU. From July to October, the average DAU was 14,300, but by November, this number surged to 79,800, an increase of 458.0%.

Data Source: Ronin Chain Key Stats

• Daily Transaction Count

From August to November, the gaming sector accounted for over 80% of Ronin's total transaction count, with this figure at 74.7% in July.

Data Source: Daily Transactions - Ronin Chain & Game

The daily transaction trend in the gaming sector reflects the overall daily transaction volume trend. Starting from mid-October, the daily transaction count has been on the rise. The daily transaction count increased from 40,100 to over 100,000, peaking at 226,000 on November 22.

Data Source: Ronin Chain Key Stats

Key Games

• Axie Infinity

From July to October 2023, Ronin's flagship game Axie Infinity contributed over 80% of the platform's DAU. However, with the addition of Pixels, the user share of Axie Infinity dropped to a historical low of 9.12% on November 18. Despite this decline, Axie Infinity's DAU remained stable at around 15,000.

Data Source: Daily Active Users - Ronin Chain & Axie Infinity

• Pixels

After landing on Ronin, Pixels quickly established itself as another flagship game, garnering over 70% of DAU. Starting from November 6, Pixels' DAU began to grow steadily. The game's DAU peaked on November 19, accounting for 83.6% of Ronin's total DAU, reaching 112,000.

Data Source: Daily Active Users - Ronin Chain & Pixels

The gaming sector is the core of the Ronin ecosystem, with Axie Infinity as its cornerstone. The addition of Pixels enriches the diversity of the chain and enhances its appeal. The rapid expansion of Pixels demonstrates Ronin's strength as the best choice for Web3 gaming to developers.

Data Source: GameFi Project Summary - Pixels on Ronin

Overall, Ronin's latest data performance shows a trend of robust growth, indicating its potential to become the preferred blockchain platform for game developers and players. Ronin is committed to scalability in the gaming sector and optimization of Web3 applications, moving towards creating an ecosystem with the best gaming experience, aiming to achieve a new milestone that surpasses the success of Axie Infinity.