Hello. This is Editor P!
It's time for the second in-depth analysis of the NFT game series. Last time, you paid a lot of attention to the article about Axie Infinity. If you missed the last article, Play games and earn money? In-depth analysis of P2E games – Axie Infinity. Please click the link! Today, let's talk about the VR real estate platform, Decentraland.
1. The prelude to Decentraland
Decentraland is a virtual reality platform based on the Ethereum blockchain and was first developed in 2015 as a proof of concept that allocates ownership of digital real estate to users. When Decentraland appeared, there was a lack of infrastructure to build a blockchain-based platform, and it was not popular to adopt cryptocurrency. Perhaps that's why in the early stages of development, digital real estate was implemented as pixels on the 2D grid, which was not 3D-based. Each pixel contained metadata that identified the owner and represented the color of the pixel, and it would be appropriate to compare it to the age of Decentraland's Stone Age. After many efforts, the 3D virtual world has been able to be divided into land compartments (Parcels), and it is amazing that 8.4 million user accounts were created in Coinbase alone in July 2017 as infrastructure construction accelerated.
Image Credit: https://academy.binance.com/
2. Digging into Decentraland
Image Credit: https://bitcoinist.com/
· What?
Decentraland is a blockchain-based multiverse, characterized by full control of creations because the land of Decentraland is permanently owned by the community. In this virtual reality world, users can buy land, enjoy various content, and even sell land to other users. When land is purchased or sold, the ownership of the virtual land is recorded in a part of the blockchain ledger, protecting the ownership of it. In addition, users can also create their own content and applications for monetization activities.
Before explaining how to play in earnest, let's first take a look at some of the terms that appear frequently in Decentraland.
- MANA: Cryptocurrency token used in Decentraland
- Parcel: A unit of land with a size of 16m X 16m.
- Estate: In the form of a combination of several parcels, the estate can be divided into parcels again.
- Scene: A collection of objects, sounds, and interactions that we can experience, made with Builder and SDK
Image Credit: https://decentral.games/
· How?
Playing Decentraland is simple. On the Decentraland official website, you can choose between playing by linking a digital wallet including Metamask or playing as a guest without a wallet. You can play the game right away without creating a separate account and signing up.
Image Credit: https://decentraland.org/
In the game, users can customize their avatars and enjoy various contents freely, so users are aiming for a network effect*. Users can visit various spaces such as the Plaza and participate in games such as casinos. As a cryptocurrency-based platform, if you play with a digital wallet, you can use tokens such as MANA and DAI for betting. Even online casinos are illegal to gamble in Korea, so you should be careful about using them, right?
*Network effect: Network effect refers to the fact that as the number of users who consume the same product increases, the utility gained from consuming the product increases.
Image Credit: https://decentral.games/
In Decentraland's Market Place or NFT exchange, land developed and built by users, items by grade, and names are freely traded. In particular, Genesis City, a square with active land transactions and serving as the center of Decentraland, is 300 squares in width and length, and about one-third of it is used as a common land including the player's starting point. In the early days of Decentraland, it was sold for 1000 MANA per square, but now it is known that it can only be purchased through Decentraland's own marketplace or other NFT exchanges. Recently, a segment of virtual real estate was sold for $2.4 million in cryptocurrencies, which drew public attention.
· Why?
Now I know what Decentraland is and how to play it, but why did Decentraland become a hit? It is a game that combines the hot trend of role-playing and real estate. Unlike most video games, Decentraland does not have a set goal for the game. Unlike games that require you to watch the ending or make a set quest, it is an open world type game where players can own LAND and play freely as they want to live in it. Decentraland's motto is a healing genre such as SimCity, Second Life, Minecraft, and Fortnite, which has become attractive to many players.
Image Credit: https://decrypt.co/
One of the reasons why Decentraland is drawing attention is that the metaverse economy is based on cryptocurrency. All lands except roads and squares can be bought and sold. Land's ownership is recorded on the Ethereum blockchain as NFT according to Ethereum Standard ERC-721. Through this, Land's ownership transfer and transaction are possible safely. Since the number of lands is not infinite, it is gaining huge popularity in terms of scarcity. Decentraland's developers have set a total upper limit of 96,061 land numbers, and each land is given its own coordinates (x,y) so it cannot be changed or mixed. Due to the scarcity of virtual real estate, owning virtual real estate has a symbol like a rise in status among early adopters and is contributing to Land's price rise.
5. Decentraland, how much did it go up?
Image Credit: https://coinmarketcap.com/
Along with the explosive interest of NFT and Metaverse keywords this year, the price of Decentraland Coin MANA is also rising day by day. There was little increase until 2021, four years after its launch in 2017, but it has gradually risen since January 2021 and is enjoying tremendous popularity, hitting an all-time high in November 2021. At the time of launch, it was only $0.01 per MANA, but as of November 30, 2021, it was $4.68 per MANA, up 468% from the past.
Along with the price surge of MANA, Land is also showing a steady increase. In 2017, when Decentraland was first released, the price per unit of Land (LAND) was $100. In 2019, some areas of Genesis Plaza, called District 331 (Estate 331), were sold for $80,000. It sets a record of being the second most expensive NFT. And in January 2021, a land (LAND) that has not yet been developed is sold at a price of about 8,000 MANA, approximately $1400 at market price, showing a 14-fold increase in land prices over the past three years. Decentraland has had about 50,000 land transactions since its launch, with a total transaction amount of more than $30 million and an average price of $560.
6. Decentraland, what will happen?
Image Credit: https://coinmarketcap.com/
Decentraland recently topped the market capitalization ranking in the NFT category, beating Axie Infinity, which appeared in the last episode. I think this is proof that it's that popular these days. Many people expect more interactive games to emerge for Decentraland's community expansion. In the case of Land, there are many concerns that the price of Land will rise further in the future along with the shortage of goods because it is limited. There are also frequent concerns that if real estate purchases are not made, the attractiveness of MANA will decrease. To prepare for this situation, Decentraland is also operating in the direction of giving priority and benefits to people who will build land mainly on content, such as artists and developers, so we can look forward to a better Decentraland.
Today, we learned about the hot Decentraland, which is at the center of NFT and Metaverse popularity these days. Decentraland sounds like an impressive project that steadily develops according to the roadmap along with frequent road map updates. Decentraland's strides in the future interests us, right? I hope that Block City of our Protocon will also be loved as a game that has been steadily developing since its launch, and in the next episode, we will talk about Sandbox!
This has been Editor P!
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