What Is Decentraland?
Decentraland is a digital game that mimics reality in a three-dimensional format. This 3-D, user-owned, Ethereum-based virtual reality world platform, or open-world metaverse, is a combination of virtual reality, augmented reality, and the internet. It allows users to be part of a shared digital experience in which they play games, exchange collectibles, buy and sell digital real estate or wearables for avatars, socialize, and interact with each other. Decentraland is software that seeks to give a global network of users incentives to operate a shared virtual world, according to cryptocurrency exchange Kraken.
Decentraland is part of a growing metaverse trend that has led to a proliferation in meta-related coins. Users can run a fully immersive virtual reality world they create, in which they oversee it through its DAO, a decentralized autonomous organization. Decentraland differs from other virtual reality games in that it allows users to have some control over their environment; through DAO, users can vote directly on the game and the organization’s policies.
- Decentraland is a digital game that mimics reality in 3-D and is a user-owned Ethereum-based virtual reality world platform.
- Decentraland users oversee this digital world through DAO, a decentralized autonomous organization.
- Users can create their own environments, marketplaces, and applications using Decentraland’s three native tokens: LAND, Estate, and MANA.
- In November 2022, Decentraland had an estimated market valuation of $2.5 billion.
How Does Decentraland Work?
Users create their unique environments, marketplaces, and applications using Decentraland’s three native tokens: LAND, Estate, and MANA. ERC-721 tokens, like LAND and Estate, make each token unique. Because of this factor, they’re not interchangeable and are referred to as non-fungible tokens (NFTs). This means that they don’t act as currencies, but are used to create avatars, wearables, and unique parcels of land.
MANA is an ERC-20 fungible token that serves as Decentrand’s digital currency. It can help users create decentralized games, apps, and other services and lets them monetize their creations, in that it allows them to digitally build what they wish and to explore the virtual space at will.
Users can use Decentraland’s map and join in on scheduled community events, which can include concerts, movie screenings, and casino nights. Other options are to buy or sell digital art and land. Clusters of land parcels have different characteristics. Decentraland’s squares include Vegas City, District X, a red-light district, Fashion Street, Dragon City, and those based on other themes.
How to Join Decentraland and Get Started
Users get onto Decentraland by opening an account. To do so, they must have a suitable Ethereum cryptocurrency wallet, which securely holds funds. A recommended one is MetaMask, which is accessible through a browser’s extensions catalog. One way to think about a digital account is as a bank account number and the wallet as a debit card.
Users also must create a passport, at which point they are assigned an avatar, which they can name.
The Decentraland system offers a beginner’s tutorial, options for exploring what’s offered, and instructions on how to chat with other users.
What Is the History of Decentraland?
In 2017, Argentine blockchain professionals Ari Meilich and Esteban Ordano launched Decentraland, for which they created the game’s smart contracts. It began as a proof of concept, which is an experiment or pilot project, in which it would assign ownership of a digital real estate plot to its users on the blockchain. They developed the platform as a two-dimensional (2-D) project that slowly transcended to a 3-D world.
At first, parcels of digital land sold for about $20, and MANA tokens sold for 2 cents. The game’s first map, Genesis City, included 90,601 land parcels. In 2017, Decentraland raised more than $26 million in its initial coin offering (ICO).
In April 2021, during a surge in popularity for NFTs, Decentraland parcels sold for between $6,000 and $100,000.
Because of the relatively small pool of MANA, the currency is volatile, and it has spiked after events like Facebook’s rebrand to Meta, a nod to the company’s bet on the success of the metaverse, for instance. The highest spike occurred shortly after the rebrand when Tokens.com purchased “largest metaverse acquisition in history,” peaking at $5.90 in late November.
In November 2022, Decentraland reportedly had a market valuation of $2.5 billion.
What Is a Smart Contract?
A smart contract is a self-executing contract with the terms of the agreement between buyer and seller written directly into lines of code. The code and the agreements contained in the contract exist across a distributed, decentralized blockchain network. The code controls the execution, and transactions are trackable and irreversible. Smart contracts permit trusted transactions and agreements to be carried out among disparate, anonymous parties without the need for a central authority, legal system, or external enforcement mechanism. While blockchain technology has come to be thought of primarily as the foundation for bitcoin, it has evolved far beyond underpinning the virtual currency.
What Is Digital Money, or Digital Currency?
Digital money (or digital currency) refers to any means of payment that exists in a purely electronic form. Digital money is not physically tangible like a dollar bill or a coin. It is accounted for and transferred using online systems. One well-known form of digital money is the cryptocurrency Bitcoin. Digital money also can represent fiat currencies, such as dollars or euros. Digital money is exchanged using technologies such as smartphones, credit cards, and online cryptocurrency exchanges. In some cases, it can be converted into physical cash through the use of an ATM.
What Are Non-Fungible Tokens (NFTs)?
NFTs are cryptographic assets on a blockchain with unique identification codes and metadata that distinguish them from each other. Unlike cryptocurrencies, they cannot be traded or exchanged at equivalency. This differs from fungible tokens such as cryptocurrencies, which are identical to each other and, therefore, can serve as a medium for commercial transactions.
The Bottom Line
Decentraland is a 3-D digital game that is a user-owned, Ethereum-based virtual world platform, or metaverse, allowing users to be part of a shared digital experience. With Decentraland, they can play games, exchange collectibles, buy and sell digital real estate or wearables, socialize, and interact.
It was launched in 2017, and by November 2022, it had an estimated market valuation of $2.5 billion.