Why Blockchain Games Built Their Own Roads: Gas Fees and Layer 2s, Explained

In December 2017, a game about collecting cartoon cats brought the world's biggest smart-contract blockchain to a crawl. CryptoKitties was so popular that Ethereum backed up for days: transactions waited in line, and fees rose for everyone, cat lovers or not.

That moment explains almost everything about how blockchain gaming developed afterwards. Ronin, Immutable X, Polygon, Oasys, Xai: nearly every gaming chain you've heard of exists to solve the problem CryptoKitties exposed. The problem has a name: gas.

What gas is

Every action on Ethereum, whether sending a token, trading an item or running a game move, uses computing work that thousands of computers around the world must repeat to verify. Gas is the unit that measures that work. Simple actions use a little; complex ones use a lot.

You pay for gas in ETH, priced in tiny units called gwei (one gwei is a billionth of an ETH). The fee you pay is roughly:

gas used × price per unit of gas

And the price per unit isn't fixed. Each block has limited space, so when lots of people want in at once, the price rises, like surge pricing on a ride-hailing app.

Why games and gas don't mix

For a DeFi trader moving thousands of dollars, a few dollars of fees is annoying. For a player crafting a potion, it's absurd. Games involve many small actions, and each one is a transaction. During busy periods on Ethereum, the fee for a single move could easily exceed the value of what you were doing.

That's why early blockchain games felt so strange: you'd hesitate to click, because clicking cost money.

Fix one: run your own road (sidechains)

The first wave of solutions built separate chains next to Ethereum. Ronin, launched in 2021 for Axie Infinity, was a sidechain: its own blockchain with its own validators, connected to Ethereum through a bridge. Fees were tiny because Ronin only had to serve one game's players.

The trade-off was security. A sidechain is only as safe as its own validators, which Ronin learned painfully in 2022 when attackers stole about $625 million from its bridge. In May 2026, Ronin became a layer 2 instead. (Our Ronin explainer has the full story.)

Fix two: express lanes that report back (rollups)

The more popular answer today is the layer 2 rollup. A rollup processes transactions off Ethereum's main chain, bundles thousands together and posts a compressed summary back to Ethereum. Players get speed and low fees; Ethereum keeps the final record.

There are two main kinds:

• Optimistic rollups assume transactions are honest and allow a window for anyone to challenge them. Arbitrum and networks built on the OP Stack work this way.
• Zero-knowledge (ZK) rollups attach a cryptographic proof that everything was computed correctly. Immutable X, Immutable zkEVM and Starknet use this approach.

Immutable X, built on ZK technology from StarkWare, launched in 2021 with zero gas fees for minting and trading NFTs, and was billed as capable of more than 9,000 NFT transactions per second.

The 2024 upgrade that cut layer 2 fees

Rollups still had to pay Ethereum to store their data, and that was their biggest cost. In March 2024, Ethereum's Dencun upgrade introduced EIP-4844, often called "proto-danksharding". It added a new, cheaper type of temporary storage for rollup data, known as blobs. Fees on many layer 2 networks dropped sharply afterwards.

For game developers, that made it far more realistic to put frequent actions on-chain, or to pay players' fees on their behalf.

What players actually see now

In many modern blockchain games, you'll never see a gas fee at all. Studios increasingly sponsor fees, using tools like account abstraction (see our account abstraction explainer) or chain designs like Oasys's Verses, where developers pay gas instead of players.

Why it matters

Gas fees are the reason blockchain gaming became a story about infrastructure. Each new chain promised to make playing cheaper. Most of them delivered, and fees are no longer the main barrier for players. The harder problem, making games people want to play, was never going to be solved by a cheaper road. For the race between those roads, read our long feature on Polygon and its rivals.