Ethereum's King Returns: Ronin Returns to L2 from Sidechain

Ronin's Strategic Shift: Ronin announced its transition from an Ethereum sidechain to a Layer 2 solution on August 15th, marking a significant move towards scalability and integration with Ethereum's ecosystem.
Historical Context: Originally developed for Axie Infinity in 2021, Ronin addressed Ethereum's high gas fees but faced a major hack in 2022, losing $625 million. The team recovered by upgrading security and transitioning to DPoS.
Current Success: By 2025, Ronin rebounded with over 1 million daily active wallets, $9.41 billion in DEX transactions, and $750 million in TVL, supported by games like Pixels and Lumiterra.
Why L2?: Sidechains like Ronin face limitations in security and liquidity. Moving to L2 leverages Ethereum's shared security and high throughput, using zkEVM for lower costs and faster transactions.
Ethereum's Dominance: Ethereum's Q3 2025 recovery (ETH near $4,600) and $94.55 billion DeFi TVL made it an attractive base for Ronin, ensuring broader asset circulation and adoption.
Technical Upgrades: Ethereum's 2025 Pectra hard fork and upcoming Fusaka upgrade (boosting L2 scalability) further incentivized Ronin's shift.
Migration Plan: Ronin aims to complete the transition by Q2 2026 using Polygon's CDK, increasing transaction speeds 12x and positioning itself as an "Ethereum game engine."
Tokenomics Update: RON token rewards will shift to a "proof of distribution" model, incentivizing builders and validators to strengthen ecosystem growth.
Future Outlook: The move could reignite blockchain gaming, with Ronin likened to "the Nintendo of crypto," leveraging Ethereum's modular ecosystem for long-term competitiveness.

Written by: 1912212.eth, Foresight News

On August 15th, Ronin announced its transition from an Ethereum sidechain to a Layer 2 solution. Just five months ago, Ronin had only announced plans to expand its DeFi business and integrate gaming and consumer DApps into its sidechain. So, how did it suddenly begin its comeback journey?

Four years ago, Ethereum's scaling roadmap was still in its early stages. Ronin says things are very different now. Ethereum has "returned to prominence." Transaction costs and speeds have reached unprecedented levels. As the underlying infrastructure for popular Web3 games like Axie Infinity, Ronin's strategic shift not only signals a resurgence of Ethereum enthusiasm, but also perhaps heralds the evolution of gaming blockchains towards greater maturity and scalability.

Past winners

The Ronin network's origins date back to 2021, when it was developed by the Sky Mavis team specifically for the phenomenal game Axie Infinity. At the time, high gas fees and congestion on the Ethereum mainnet had become a pain point for gamers. Ronin emerged as a sidechain, providing a low-cost, high-throughput transaction environment.

At its peak, Axie Infinity attracted millions of players, and Ronin's daily active users exceeded 1 million, driving the global popularity of the "Play-to-Earn" model.

However, the good times didn’t last long. In March 2022, Ronin suffered its largest-ever hack, resulting in a loss of $625 million in assets. This incident exposed the shortcomings of sidechains in terms of security and decentralization, and many believed that Ronin would eventually fall.

However, the Sky Mavis team demonstrated remarkable resilience, successfully restoring the network by upgrading the validator mechanism, transitioning to a delegated proof-of-stake (DPoS) consensus, and collaborating with institutions like Binance. In August 2024, Ronin persuaded the white hat hacker to return $10 million worth of ETH, preventing further financial losses.

By 2025, Ronin had resurged, with daily active wallets stabilizing at over one million. Ecosystem games like Pixels, Lumiterra, and Fishing Frenzy continued to thrive. According to its official website, on-chain DEX transactions reached $9.41 billion, with total NFT transactions reaching $6.47 billion. Its total TVL currently stands at $750 million, and its wallet has been downloaded 31 million times.

The limitations of sidechains are becoming increasingly apparent

The trigger for this transition lies in the limitations of the sidechain model. With the rapid development of the Ethereum ecosystem, while sidechains can provide independence, they often sacrifice shared security and liquidity integration with the mainnet.

The Ronin team stated in the announcement: "Ronin is returning to Ethereum as a Layer 2." This decision is not a sudden whim, but rather a fundamental industry trend. By 2025, multiple Layer 1 chains like Celo and Cronos had migrated to the Layer 2 architecture, highlighting the advantages of Layer 2 in achieving high TPS (transactions per second) while inheriting Ethereum's security.

According to the Ethereum Foundation, L2 solutions have boosted the overall network transaction throughput to over 100,000, driving global adoption. Ronin's transformation will utilize zero-knowledge proof (zk) technology to build a zkEVM (Zero-Knowledge Ethereum Virtual Machine), which will not only maintain compatibility with Ethereum but also significantly reduce transaction costs and latency.

Ethereum Returns as King

A key reason why Ronin chose to return to Ethereum and transform into a Layer 2 solution was Ethereum's strong recovery in Q3 2025. ETH stabilized above approximately $4,600 in mid-August, close to its all-time high.

The market's renewed confidence in Ethereum is also due to the explosive activity of its ecosystem.

According to DefiLlama data, the total value locked (TVL) in DeFi on the Ethereum mainnet has exceeded $94.552 billion, far exceeding Solana's $10.828 billion, maintaining its dominance in the DeFi market. This high activity provides Ronin with a vast user base and liquidity pool, ensuring that its game assets can circulate within the broader Ethereum ecosystem after the transition, achieving higher adoption rates.

Furthermore, Ethereum's future technical roadmap further enhances its appeal to L2 projects. Following the Dencun upgrade in 2024, the Pectra (Prague-Electra) hard fork was successfully deployed in Q1 2025, significantly improving network scalability, reducing fees, and optimizing the staking mechanism. Looking ahead, Ethereum plans to launch the Fusaka upgrade by the end of the year. Fusaka is Ethereum's first major upgrade since Pectra focused on underlying performance optimization, encompassing several core Ethereum Improvement Proposals (EIPs). Fusaka will significantly increase blob capacity, allowing Layer-2 rollups (such as Arbitrum and Optimism) to process more data and reduce fees, helping to achieve transaction throughput reaching tens of thousands of transactions per second.

In addition, after the upgrade, through Verkle tree and PeerDAS, the node operation cost is reduced, the equipment requirements are reduced, and it is conducive to a more decentralized network - including the development of mobile and light client ecosystems.

For Ronin, this attraction means shifting from an isolated sidechain to a thriving "modular" ecosystem, boosting its long-term competitiveness in the Web3 gaming sector.

Migration will be completed in Q2 2026, and the token will be launched with the new "Proof of Allocation"

Regarding the specific details of the transition, Ronin plans to complete the migration by the second quarter of 2026, using Polygon's Chain Development Kit (CDK) as its foundation. Ronin will benefit from Ethereum's strong security and decentralization, and transaction speeds will increase by 12 times.

This speed boost is crucial for games like Axie Infinity, allowing players to more seamlessly trade NFTs and conduct in-game economic activities. Secondly, developers will benefit significantly. Ronin will be positioned as the "Ethereum game engine," attracting more third-party builders to deploy custom L2 chains. New projects such as Cambria Duel Arena, Fableborne, and Angry Dynomites are already emerging within the ecosystem, leveraging L2's DeFi integration to seamlessly integrate gaming and finance.

It is worth mentioning that after the migration, the RON token’s equity rewards will also be used to reward builders through a new “proof of distribution” model.

Over the past few years, RON rewards have been distributed to Governing Validators and Regular Validators to incentivize them to ensure network security. With this upgrade, RON rewards will flow to Governing Validators and Contributors. This will strengthen the incentive relationship between builders and users, creating a new virtuous cycle centered around the RON token.

Sky Mavis co-founder Jihoz once said: "Ronin is the Nintendo of the crypto world." As the migration progresses, Ronin may be able to rekindle the hope of blockchain gaming.