On 28 June 2022 the Ronin sidechain was successfully restarted. The network had been offline for several months after a large hack of its cross-chain bridge in late March. The attackers stole cryptoassets worth $625m. This article sets out the key facts about Ronin and its relaunch.<\/p>\n
Ronin is a project by Sky Mavis, the company behind the popular blockchain game Axie Infinity<\/a>. The app initially ran on Ethereum, but its throughput was insufficient to handle in\u2011game operations.<\/p>\n Sky Mavis then built a layer\u20112 solution\u2014the Ronin sidechain. The link between it and Ethereum was the cross-chain Ronin Bridge, which allowed ERC\u201120 assets to be moved into Axie Infinity.<\/p>\n In 2021 the game\u2019s popularity surged: from May 2021 to January 2022, 1.44m buyers carried out roughly 12.6m transactions in non-fungible tokens (NFTs).<\/p>\n Axie Infinity became the outright leader by NFT trading volume: in 2021 its turnover is estimated at $3.5bn to $3.85bn, whereas its nearest rival, NBA Top Shot, managed just $827m.<\/p>\n Amid the frenzy, the sidechain bet paid off. By some estimates, in November 2021 alone Ronin processed more than 560% of Ethereum\u2019s transaction count.<\/p>\n Ronin\u2019s speed was roughly four times that of Ethereum. Thanks to Ronin, trades on the Axie marketplace and asset transfers settled within seconds.<\/p>\n Ronin also mitigated high fees. Gas on Ethereum often ranged from $100 to $200, making microtransactions uneconomic.<\/p>\n In addition, users of the official Ronin Wallet received a set number of free transactions for various actions in Axie Infinity, as well as for holding Axie NFTs or virtual land plots in the wallet.<\/p>\n<\/div>\n In late March 2022 the Ronin sidechain used by Axie Infinity fell victim to one of the largest hacks in the history of decentralised finance (DeFi).<\/p>\n Exploiting a vulnerability, the attackers withdrew cryptoassets worth over $625m: 173,600 ETH and 25.5 USDC.<\/p>\n The developers discovered the security breach only a week after the attack. They found that a team member had been hit by a phishing attack, allowing the perpetrator to access the company\u2019s infrastructure and Ronin validators.<\/p>\n Ronin ran with just nine validators. Only five signatures were required to approve a transaction. At the time of the attack Sky Mavis controlled four of the nine validators. Control over one more validator, operated by Axie DAO, was gained via a backdoor related to a gas\u2011free RPC<\/span> node on Ronin.<\/p>\n Such an architecture ran counter to basic security principles. In blockchains, validator nodes are typically run by different teams or firms to preserve a distributed structure. Ronin\u2019s creators used a centralised approach\u2014a significant share of validators belonged to one company. That proved a fatal error.<\/p>\n<\/div>\n In early 2022 Sky Mavis launched<\/a> the RON token. It is designed for project governance and is used for transactions on the Ronin network. After the hack, RON\u2019s price fell from $2.3 at the end of March 2022 to $0.2 by late June.<\/p>\n After the relaunch was announced, RON rose by roughly 40% over the week and reached $0.36 by the time of the event. Observers, however, note the steady decline in revenues at the Axie Infinity game that uses Ronin and poor tokenomics for the project.<\/p>\n<\/div>\n Beyond Axie Infinity, the sidechain\u2019s main application was Ronin Wallet, which allowed users to store game\u2011related cryptoassets. The ecosystem also included the decentralised exchange Katana (Ronin DEX), where in\u2011game currencies could be swapped.<\/p>\n<\/div>\n The game\u2019s developers restarted Ronin after upgrading security and conducting several rounds of audits on the Ronin Bridge code. They also introduced new safety mechanisms, in particular an automatic “off switch” that halts the bridge when someone attempts a suspiciously large swap. A withdrawal limit of $50m per day now applies to Ronin Bridge.<\/p>\n Immediately after the incident Sky Mavis raised the number of validator signatures needed to confirm transactions on Ronin. The company pledged to decentralise the network and raise the number of active nodes to 100, and to implement a zero\u2011trust architecture.<\/p>\n Following the relaunch, Ronin Network introduced a body of “governors” to vote on adding new validators, upgrading smart contracts, changing the bridge\u2019s daily limit and other major changes to the blockchain.<\/p>\n One of the most important elements of the relaunch is compensation for stolen funds. Back in April the Ronin team raised $150m for this purpose. Sky Mavis promised to pay a further $450m from its own funds.<\/p>\n As stated in the relaunch announcement, all users\u2019 stolen wETH and USDC were returned and are fully collateralised on Ethereum. The fate of another 56,000 wETH stolen from the Axie DAO treasury remains unknown\u2014they expect to recover them through law\u2011enforcement investigations.<\/p>\n<\/div>\n The cross-chain bridge for Ronin is already operational<\/a>. It allows transfers from Ethereum to Ronin of ETH, AXS (the ecosystem\u2019s native coin), SLP (Axie Infinity\u2019s main in\u2011game asset) and the USDC stablecoin. You will need a browser wallet that supports Ethereum, as well as Ronin Wallet<\/a>.<\/p>\n<\/div>\nHow was Ronin hacked?<\/h2>\n
Does Ronin have its own token?<\/h2>\n
Which applications ran on Ronin?<\/h2>\n
What changed after the relaunch?<\/h2>\n
How to move assets from Ethereum to Ronin?<\/h2>\n