What is Decentraland (MANA)? The Virtual Real Estate
Decentraland can be more than just a virtual reality game. What is Decentraland (MANA) and how is it changing the crypto landscape?
What happens when we combine popular sandbox games like Minecraft, GTA Online, or The Sims Online, with state-of-the-art blockchain technology? We have Decentraland.
Decentraland is a 3D massively multiplayer online virtual world that is more than just a game. For some of the inhabitants, the world means business.
In Decentraland, parcels of scarce virtual land are sold as non-fungible tokens (NFTs) on the Ethereum blockchain. Owners of virtual land can do whatever they want with it — create content, games, virtual shops, and more.
Some adjacent parcels (also referred to as ‘neighborhoods’) are high traffic areas, capable of bringing high ad revenues as well as paying visitors that will consume content, play games, and purchase goods (custom, player-minted NFTs) and services.
New to NFTs: Read our guide on non-fungible tokens (NFTs).
How does Decentraland work?
Decentraland is not controlled by a centralised authority, hence the name Decentraland, which is perhaps a portmanteau of “decentralised land”.
In this virtual world, landowners can publish any content or app as they please — making the platform resistant to censorship.
Apart from that, content creators can monetise their creations, either by placing ads or directly selling their creations for profit.
Parcels of land in Decentraland are represented by the LAND token, which is a non-fungible ERC-721 token that can be purchased in the primary market using the MANA token.
MANA is the in-game cryptocurrency, and it is a fungible ERC-20 token. When Decentraland was first launched in 2017, a total of about 2.6 billion MANA tokens were minted.
However, during the primary market sale of LAND, the MANA tokens were burned when exchanged with LAND. There is currently 1.85 billion MANA in active circulation.
On the secondary market, LAND can be bought and sold using MANA in a peer-to-peer transaction. In this case, no MANA is burned. Once bought, the new owner’s digital identity is recorded on the Ethereum blockchain as the rightful owner of a specific parcel of LAND.
Related: What is Digital Identity?
How is MANA distributed?
In terms of crypto token distribution, MANA is one of the well-distributed tokens in existence. When the initial supply of MANA was created, 40% was sold in an initial coin offering (ICO).
The 20% was distributed to partners and communities that have supported the project since the beginning. This is distributed as allowances instead of direct token transfers.
The remaining 40% is split as follows — 20% was retained by the Decentraland Foundation for continuous development of the platform, and 20% goes to the founding team for their hard work.
How much LAND is there in Decentraland?
Decentraland is divided into 90,000 parcels of LAND. Each parcel has an area of 16 x 16 “meters”. Buyers can buy more than one parcel of LAND, and at any location (represented by x and y-values on the map).
On Decentraland, owners can do one or more of the following activities:
The scripting language of Decentraland was built to allow developers to create objects, load textures and sounds, encode user interactions including payment systems, and it even handles physics. So, it’s possible for someone to create a Martian-like parcel of land with lower gravitational forces, for example.
Unlike other NFTs that currently exist in the crypto space, LAND has a unique property called adjacency. This means visitors can see other parcels of LAND adjacent to the one they’re currently on.
This spatial relationship allows neighborhoods and geographically close communities to congregate, and even share the same theme or interest.
Open-world and centralised virtual reality platforms have already utilised the advertising business model for the server’s own benefit. In Decentraland, anyone can rent out ad space on their own parcel, or rent space from other owners.
Adverts can appear as billboards in high-traffic land parcels. Any brand, both within the virtual and real economy, can be marketed this way.
Create digital collectibles
NFTs often exist in vacuum and do not interact with one another. In this navigable world, nearly everything is an NFT, if the creator wishes to sell them.
Users can publish, distribute, collect, and even display digital assets within the boundaries of what is possible in Decentraland.
Socialising and having fun
Creating a platform where users can gather and have fun is perhaps the primary aim of Decentraland.
Commerce and in-game economics aside, interacting with Decentraland doesn’t always have to bring financial gains. For any game, if users are having fun, then everyone would feel like a winner.
Is MANA still valuable in Decentraland?
Decentraland is one of the most interesting investment vehicles developed in the modern world. While real estate is no doubt a reliable investment and source of passive income, serious investment institutions have not yet considered the possibility to invest in virtual land — at least, except for Republic Realm.
Republic Realm describes themselves as “a professionally-managed, diversified digital real estate investment vehicle for virtual crypto and blockchain metaverse NFT tokens…”.
In June 2021, they invested US $913,228 worth of parcels in Decentraland. That was to buy 259 parcels (virtually equivalent to 6.6 hectares of land).
Their plan was to build a virtual shopping district called Metajuku, which is a nod to Harajuku shopping district in Tokyo.
Just like how land developers make money, the strategy may bring high traffic to the purchased parcel, increasing its value, while bringing passive income, perhaps through parcel rentals.
MANA, being an in-game currency, will be incredibly useful for the purchase of goods and services in Decentraland.
While a few cryptocurrencies have become nothing more than a store of value (similar to gold), the value of MANA will increase along with the economy of Decentraland.
The more people interact with Decentraland and all the creations that reside within it, the more real value will be put into circulation.
How to Buy Decentraland (MANA) in South Africa?
With all that said, what are your thoughts on the MANA token? Are you feeling confident on the MANA token?
As prefaced above, Decentraland is quickly becoming one of the most prominent lending protocols in the DeFi space. This makes MANA an ideal candidate for those wanting to diversify their crypto portfolio.
MANA is just one of over 160+ altcoins that we offer at Easy Crypto South Africa. Our collection consists of NFT tokens, Metaverse, DeFi, and many more.
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Disclaimer: Information is current as at the date of publication. This is general information only and is not intended to be advice. Crypto is volatile, carries risk and the value can go up and down. Past performance is not an indicator of future returns. Please do your own research.
Last updated Oct 11, 2022