Ethereum layer-2 scaling platform Starknet has reached a decentralization milestone laid out by Ethereum co-founder Vitalik Buterin and is now the largest zero-knowledge rollup-based network by total value locked.

Starknet said in a press release shared with Cointelegraph that it has hit “Stage 1” decentralization, according to a framework Buterin laid out in 2022, which means the network operates with limited oversight or “training wheels.”

Starknet added that the framework was the “gold standard onchain tool for analyzing Ethereum scaling solutions,” and said it achieved the milestone through changes such as creating a security council and censorship-avoidance mechanisms. 

While the system still allows intervention from a security council, it has implemented a fully functional validity proof system governed by smart contracts.

Starknet is now the only layer-2 ZK-rollup network to have reached Stage 1 and has grown to be the largest ZK-rollup blockchain with a total value locked of $629 million, just ahead of ZKsync’s $610 million, according to L2beat. 

Starknet is the fifth-largest layer-2 network by value locked, with the top four all Optimistic rollup-based and all reached Stage 1 decentralization using fraud proofs. 

Layer-2 networks ranked by total value locked. Source: L2beat

Fraud proofs assume transactions are invalid until proven valid, while validity proofs assume transactions are valid only if proven valid with cryptographic evidence.

“Our goal is for the training wheels to come off completely and to reach Stage 2 decentralization on Ethereum, and simultaneously steam forward with our work on Bitcoin too,” said Eli Ben-Sasson, co-founder and CEO of StarkWare, the developer behind Starknet. 

“Stage 2” decentralization is the point where the network will be fully autonomous and community-governed. Only three small layer-2 scaling platforms have reached this stage, according to L2beat. 

Related: Vitalik Buterin says rollups must prove security before decentralizing

Buterin introduced the concept of “training wheels” or three stages for Ethereum scaling rollup projects at various phases of development in 2022.

Base leads layer-2 ecosystem

The Coinbase layer-2 network Base is the leader of the sector in terms of value locked, with $14.7 billion, giving it a market share of 33%. Comparatively, Starknet has a market share of 1.4%. 

The total value secured onchain in the layer-2 ecosystem is $44.2 billion. The figure has jumped recently as the value of Ether (ETH) has gained, but is down 20% so far this year.

Magazine: Metric signals $250K Bitcoin is ‘best case,’ SOL, HYPE tipped for gains: Trade Secrets

Blockchain gaming user activity dipped and funding slowed in April, but the overall ecosystem is healthier and maturing, according to blockchain analytics platform DappRadar.

User activity dropped 10% over April, with blockchain gaming reaching a 2025 low of 4.8 million daily Unique Active Wallets, DappRadar analyst Sara Gherghelas said in the platform’s April Games Report.

Gaming dominance over the decentralized app industry also fell and is now tied with decentralized finance at 21%. 

Gherghelas said it’s clear user attention is shifting away from gaming, but under the surface, new infrastructure went live, major publishers doubled down, and high-quality games edged closer to launch.

Source: DappRadar

“The blockchain gaming industry isn’t dead — it’s evolving. It’s moving from noise to signal,” she said.

“Teams are building, and capital continues to flow into the space. What we might be seeing is a healthier ecosystem — one driven less by speculative play-to-earn mechanics and more by users who have a genuine interest in gameplay, asset ownership and community.”

April’s blockchain gaming investment activity also dropped 69% from March, reaching $21 million.

Weaker projects die off, funds shift to builders

Gherghelas said part of the drop is because investor and user interest is increasingly shifting toward real-world assets and artificial intelligence.

Another factor is the macroeconomic landscape, with ongoing market uncertainty weighing on investor sentiment, making capital harder to secure for startups.

Gherghelas said weaker projects “are falling away,” and funds are flowing into other projects that “are quietly laying the groundwork for the next generation of blockchain games.”

Blockchain gaming funding has seen a sharp drop since last year. Source: DappRadar

“Investors are now optimizing for sustainable models, player engagement, and actual retention, not just token hype,” she added. “This shows that the market’s clearly in reset mode.”

Gherghelas noted that “66% of all blockchain game funding in 2025 so far has gone to infrastructure,” signaling a more mature market.

Related: Crypto gaming has mixed Q1 as deals jump, investment totals dip: DappRadar

Mainstream gaming companies are also still experimenting with blockchain-powered games, with Gherghelas pointing to Ubisoft’s partnership with Immutable, and Sega adding non-fungible tokens and play-to-earn mechanics to its game, KAI: Battle of Three Kingdoms.

“April 2025 wasn’t a record-breaking month for blockchain gaming, and that’s okay. What we’re seeing is a space recalibrating,” she said.

“Speculative hype is cooling down, but the builders haven’t stopped,” she added. ”Games are launching. Ecosystems are expanding. Infrastructure is maturing.” 

Magazine: Illegal arcade disguised as … a fake Bitcoin mine? Soldier scams in China: Asia Express

Another 12 people have been charged for their involvement in a $263 million crypto crime spree that stole 4,100 Bitcoin from a Genesis creditor last August, along with a string of break-ins and money laundering. 

The 12 new names, included in a superseding indictment, add to charges originally brought against the main defendant in the case, Malone Lam, on Sept. 19, 2024, the Department of Justice noted in a May 15 statement.

Jeandiel Serrano was named a defendant in the initial indictment but was not included in the superseding one.

The DOJ said several defendants have been arrested, while two others are believed to be living in Dubai.

Many of the suspects, with aliases like “Goth Ferrrari” and “The Accountant,” come from California, mostly aged between 18 and 22. 

The group allegedly began operating in October 2023, evolving from friends while playing online games to what the DOJ describes as participating in a “cyber-enabled racketeering conspiracy.”

Hacking, burglarizing and laundering

The DOJ said group members were tasked with everything from hacking databases, cold calling crypto holders to conduct social engineering attacks to even burglarizing houses to steal crypto hardware wallets.

Others were involved in laundering the stolen proceeds, which the DOJ claimed amounted to $263 million. 

Over $230 million resulted from a single instance on Aug. 18, 2024, when Lam fraudulently obtained over 4,100 Bitcoin (BTC) from a victim.

Related: Crypto exchange CEO’s daughter fights off brazen kidnappers in Paris

The DOJ said Lam also hacked into another victim’s iCloud account to watch their movements, while defendant Marlon Ferro would break into their house to steal crypto hardware wallets.

Virtual private networks, crypto mixer protocols and exchanges using “peel chains” were used to make it harder to trace the illicit activity, the DOJ said. A peel chain is a money laundering tactic where crypto is transferred through a series of wallets, with small amounts of funds “peeled off” at each step.

They have been charged with RICO (Racketeer Influenced and Corrupt Organizations) as well as offenses involving wire fraud and money laundering.

Gone in 60 seconds

Members of the crypto theft ring allegedly used proceeds to pay for nightclub services — costing up to $500,000 on some nights — 28 exotic cars as expensive as $3.8 million, in addition to luxury handbags, watches, and clothing.

Homes and jets were even rented out with fake identity documents to fund their lavish lifestyles, the DOJ noted.

Magazine: Japanese porn star’s coin red flags, Alibaba-linked L2 runs at 100K TPS