What is Decentraland? Virtual Real Estate in a Blockchain Game
Many know Decentraland for the popular Mana token that has been successfully trading around and maintaining a strong position in the top 100 cryptocurrencies.
But the success of the Mana token proceeds from the whole Decentraland ecosystem. The developing team managed to turn their project into a virtual reality where users can buy LAND, collectibles, and many more unique elements.
And by exploiting the enormous potential NFTs come with and the Ethereum blockchain capabilities, Decentraland becomes a leading decentralized virtual reality game that resembles a virtual real estate market.
What is Decentraland?
In essence, Decentraland is a virtual reality platform powered by Ethereum in which users can create, mold, and monetize the environment by playing the game.
The Decentraland project was co-funded in 2016 by Ariel Meilich and Esteban Ordano and kicked off in 2017 with an ICO that brought in $24 million. The project continued expanding and gaining more interest as people started buying digital land in the future virtual reality that was soon to be launched.
The project started making the news in 2018 as the investors were making more than 500% profit from buying virtual real estate that didn’t even exist yet.
Next, in 2019, the developing team launched the closed beta, with one of the first 3D games hosted on the Ethereum blockchain.
And in February 2020, Decentraland was made available to the public.
The Decentraland Gameplay
Decentraland is inspired by the popular virtual reality games Second Life and Minecraft. The slight resemblance is quite visible, starting from the elements used in advertising the project as well as gameplay, NFTs such as LAND and wearables, and the overall design of the world.
The world comprises different kinds of blocks, LAND lots, roads, plazas, and many different player-generated events such as games, concerts, and conferences.
In order to access Decentraland, you only need to go to the website and log in. The game takes place within the browser; you don’t have to download and install anything.
You can log in to the game through your Metamask wallet integrated with the browser or through an email address linked to the Fortmatic hot wallet.
However, if you don’t have any and just want to have a quick look at Decentraland, the game allows you to access it as a guest.
Whether you choose to enter the game by registering or have a run as a guest, you are spawned at the Genesis Plaza, in the middle of the map. And from that point, you can start exploring the world.
You can explore the world for free, but the game gets more interesting once you have your own land and start building.
Besides building virtually anything and exploring the world, players can participate in virtual concerts and football tournaments, visit NFT art galleries, or check the in-game advertisement.
But truth be told, right now, the game is quite empty in terms of players. Although Decentraland registers 18,000 daily active users on average, they are spread around an enormous map and on different worlds. So, even if you would stand in the same place as another player, you might not meet him because he’s playing on another server.
Although, you can always check the Decentraland events page and see where people will gather for the next concert.
The Decentraland Marketplace
The Decentraland marketplace is a significant part of the project’s gameplay as well as of its economic system.
Users can find all kinds of assets in the marketplace, starting from parcels and estates to wearables, futures, and names.
The variations of NFTs that can be available on the marketplace, as well as in-game, have a virtually infinite number.
With the SDKs offered by Decentraland and knowledge of 3D modeling, the variety can go as far as the human imagination can go.
The Mana Crypto and the Land Token
The concept of an in-game economy is not new to Decentraland.
It has been explored and developed within prominent online games numerous times. But in Decentraland’s case, the Mana Token and other NFTs can be traded outside the game for Fiat currencies.
Therefore it’s essential to understand the tokenomics and the potential of these tokens.
MANA Tokenomics
The MANA token started out with a total supply of 2.8 billion. And although it was supposed to have an 8% inflation, as of May 2022, the supply has already gone down to under 2.193 billion.
From the total supply, currently, there are 1.84B MANA in circulation.
The difference between the initial supply and the current supply comes from the fact that 2.5% of every LAND purchase was burned in LAND auctions, then 2.5% of every transaction on the Decentraland marketplace.
As for the inflation rate, it is currently disabled. Also, in January 2021, the community voted that instead of burning, 2.5% of each transaction on the marketplace should go to the Decentraland treasury.
The MANA token started being distributed and allocated in 2017 when Decentraland sold 40% of the MANA supply during the ICO.
Besides the tokens sold through the ICO, 20% was reserved to incentivize the community, 20% went to the development team and early contributors, and 20% to Decentraland.
When it comes to utility, the MANA token is the main currency in the economic ecosystem of Decentraland and is used for buying NFTs, playing inside games, and marketplace fees.
MANA holders are also free to trade the token on cryptocurrency exchanges as it is already listed on multiple exchanges, including top-tier trading platforms.
But the crucial thing about the MANA token is that holders can vote on the development of the environment within the game. The tokens are temporarily locked in the government contract and converted as Wrapped MANA, valuing one vote for a token.
Land Tokenomics
LAND is the base NFT within Decentraland. The game registers 90,601 16×16 meters parcels, of which Decentraland still holds 71% as plazas or roads.
The parcels can be bought and sold through the marketplace and can be customized as the landlord sees fit.
Each LAND parcel offers 2000 voting power. And if the owner holds an estate comprising several parcels, they will get 2000 voting power for each parcel.
Although most LAND is owned today, new players can also become parcel or estate owners by buying it through the marketplace.
However, the value varies greatly considering the proximity to plazas, roads, points of interest, or how developed the parcel is.
The LAND available for sale is signaled in the marketplace by simulating the in-game map and coloring the parcels with light blue.
Decentraland Roadmap
Nowadays, Decentraland works mostly as a Decentralized Autonomous Organization integrating a DAO section within the website for governance purposes.
The players own and build the world and decide where the game is going with development.
Although it may seem like the game’s development has stopped since the launch of virtual reality, Decentraland has a public roadmap on Trello featuring the upcoming updates.
Unfortunately, the roadmap only shows an order of tasks but no deadlines.
But functioning as a DAO and allowing players and private parties to implement features, Decentraland’s potential for improvements goes beyond the roadmap.
Besides the live stream events and NFT arts galleries, there are various ambitious projects within the game.
Third-party crypto gaming project Ethermon is looking to implement complex content and Mechanics within Decentraland:
- Additional Content Releases
- District Rollout with First Biome Release
- PvE and PvP Battling Systems
- Guild and Tournament Features
- Massive EMON + MARKS Utility Implementations
- Mobile Sync to the Metaverse
In 2022, Decentraland gained a lot of interest, particularly from large investors, with Microsoft investing $69 million in the development of the Decentraland open-source project. Aside from other significant collaborations over the months, their team has recently introduced the My Store area to the virtual shop.
Allowing customers to personalize the appearance of their store’s cover, including the avatar, bio description, and social network connections. The Decentraland Team brought royalty to the platform a short time before launching My Store.
Decentraland published its plans for the year, nicknamed the 2022 Manifesto, in February, causing real joy among its community. To enhance its metaverse experience, the team develops a DAO that will let users show their NFTs as wearables within Decentraland.
In terms of future events, the team says that work on the Decentraland Protocol is still proceeding. It planned to release a beta VR client in the second part of this year.
Key Takeaways
- Decentraland is a virtual reality platform powered by Ethereum in which users can create, mold, and monetize the environment by playing the game.
- Decentraland is inspired by the popular virtual reality game Second Life and Minecraft. The slight resemblance is quite visible, starting from the elements used in advertising the project as well as gameplay, NFTs such as LAND and wearables, and the overall design of the world.
- The main currency in Decentraland is the MANA token, which is used to buy LAND or other NFTs.
- As Decentraland works for the most part as a DAO, users own the game and vote on its course. Each MANA token has the value of a vote, while the LAND token offers 2000 voting power.
- The Decentraland roadmap is public on Trello, but there is no saying when the upcoming updates will be delivered. However, some developments have been made recently, including the launch of My Store, the project Manifesto, and the release of the beta VR.
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