Decentraland is a decentralized virtual reality platform powered by the Ethereum blockchain. Within the Decentraland platform, users can create, experience, and monetize their content and applications. ^[1][3]

History

Decentraland was developed by Ariel Meilich and Esteban Ordano in 2015. It was launched following a $24 million initial coin offering (ICO) that was conducted in 2017. The ICO ran for 8 days with prices rising each day and ended when the sale reached $24 million USD. Token holders were able to claim one parcel of LAND by burning 1000 MANA tokens.^[15]

Date	MANA Price
August 17th	$24 per 1,000 MANA ($0.024 per MANA)
August 18th	$26 per 1,000 MANA ($0.026 per MANA)
August 19th	$28 per 1,000 MANA ($0.028 per MANA)
August 20th	$30 per 1,000 MANA ($0.03 per MANA)
August 21st	$32 per 1,000 MANA ($0.032 per MANA)
August 22nd	$34 per 1,000 MANA ($0.034 per MANA)
August 23rd	$36 per 1,000 MANA ($0.036 per MANA)
August 24th	$38 per 1,000 MANA ($0.038 per MANA)
August 25th	$40 per 1,000 MANA ($0.04 per MANA)

In the initial distribution, 40% of the token supply was allocated to Crowdsale buyers, 20% to Decentraland Foundation, 20% to the Team & Early Contributors, and the remaining 20 percent was allocated to the Community & Partners. ^[15]

Decentraland launched its closed beta in 2019 and opened to the public in February 2020. ^[7]

Decentraland

In Decentraland, users can buy and sell digital real estate, while exploring, interacting, and playing games within the virtual world. Over time, the platform has evolved to implement interactive apps, in-world payments, and peer-to-peer communication for users. Decentraland uses two tokens: LAND and MANA. ^[1]

LAND

LAND is the non-fungible parcels in which the virtual world is divided. The utility of LAND is based on its adjacency to other attention hubs, its ability to host applications, and also as an identity mechanism. Developers and other content creators demand LAND so that they can build on top of it and reach their target audience. While LAND is a non-fungible asset within Decentraland, users can purchase LAND at a fixed cost of 1,000 MANA. LAND parcels are distinguishable from each other, potentially trading at different prices on a secondary market due to differences in adjacencies and traffic. ^[6]

MANA

MANA is Decentraland’s cryptocurrency token. It is an ERC-20 token that must be burned to acquire non-fungible ERC-721 LAND tokens. MANA used to buy goods and services in the virtual world creates utility value for the token. MANA can be used to pay for a range of avatars, wearables, names, and more on the Decentraland marketplace and MANA token holders can vote on policies through the DAO. ^[6]

Technology Architecture

The Decentraland protocol has three layers:

Consensus Layer

The consensus layer tracks land ownership and land content through an Ethereum smart contract. The non-fungible digital assets are known as LAND: each LAND has unique (x, y) coordinates, an owner, and a reference to the content description file, which encodes what the landowner wants to serve there. Decentraland clients connect to the Ethereum network to fetch updates to the state of the LAND smart contract. ^[6]

Land Content Layer

Decentraland uses a decentralized storage system to distribute the content needed to render the world. For each parcel that needs to be rendered, a reference to a file describing the parcel’s content is retrieved from the smart contract.^[6]

This decentralized distribution system allows Decentraland to work without the need for any centralized server infrastructure. This allows the world to exist as long as it has users distributing content, shifting the cost of running the system to the same actors that benefit from it. It also provides Decentraland with strong censorship resistance, eliminating the power of a central authority to change the rules or prevent users from participating. ^[6]

Real-time Layer

Here, users communicate with each other by establishing peer-to-peer connections with the help of servers hosted by landowners or third parties. Without a centralized server, peer-to-peer connections are needed to provide social interactions between users, as well as applications that the landowner wants to run inside the parcel. To coordinate the bootstrap of peer-to-peer connections, landowners have to provide rendezvous servers or understand that users will not be able to see each other in their parcel. ^[6]

Utility

Applications

Decentraland's scripting language allows the development of applications, games, gambling, and dynamic 3D scenes. This scripting language is designed to handle a wide range of capabilities, including creating objects, loading textures, handling physics, encoding user interactions, sounds, payments, and external calls, etc. ^[6]

Content Curation

Users in Decentraland can gather around neighborhoods of shared interest. Being located near high-traffic hubs drives users to the landowners’ content. ^[6]

Advertising

Brands may advertise using billboards near, or in, high-traffic land parcels to promote their products, services, and events. Some neighborhoods may become virtual versions of Times Square in New York City. Additionally, brands can position products and create shared experiences to engage with their audience. ^[6]

Digital Collectibles

Users can publish, distribute, and collect rare digital assets issued on the blockchain by their creators. Just as it occurs in other virtual worlds or through online forums, these digital assets will be traded inside this world through the scripting system and be backed by the aforementioned naming system. ^[6]

Social

Groups that gather in online forums, chat groups, or even other centralized multiplayer games can port their communities into Decentraland. Offline communities can also find a space to gather in Decentraland. ^[6]

Projects

Property Renting

On December 7, 2022, Decentraland announced that users who own LAND within Decentraland could officially rent out the rights to the space through the digital marketplace. This allows users to earn passive income off of their metaverse assets. ^[18][19]

Similar to most rental contracts of physical properties, Decentraland landlords cannot sell the land, nor can they receive any purchasing bids for purchase until after the rental contract period is over.^[18]

Metaverse Fashion Week

In March 2022, Decentraland hosted the Metaverse Fashion Week: a combination of high-end designers and wearables vendors flaunting non-fungible token (NFT) collections in the blockchain-based virtual world. Brands such as Estée Lauder, Tommy Hilfiger, Dolce & Gabbana, and Forever 21 all participated in the virtual fashion event. ^[20]

Decentraland’s Fashion Week seeks to provide a space for people to express themselves and expand the understanding of their own self through wearables on their avatars, said Sam Hamilton, Decentraland’s creative director.^[20]

"I see people being much more outrageous in the metaverse. People will see a really great use case for NFTs” as a result of the event." - Sam Hamilton

NFT marketplace Rarible hosted a pop-up shop called Rarible Street; the Rarible Fresh Drip Zone, inspired by the streets of New York, with concrete and urban vibes. Boson Protocol, which purchased a plot of land in June 2022 to create a metaverse shopping mall, built a boulevard of stores for brands to sell their wearables. ^[20]

According to Decentraland's Creative Director Hamilton, for some brands it’s an opportunity for research and development; for others, it’s an opportunity to enter the crypto space by selling metaverse apparel. ^[20]

In March 2023, Decentraland held its second annual Metaverse Fashion Week.^[21]

“Metaverse Fashion Week 2023 pushed the envelope of what is possible for digital fashion and interoperability in the metaverse. For the first time, we witnessed real cooperation between fashion brands and the community, which resulted in incredible feedback from participating brands.” - Gigi Graziosi Casimiro, Head of MVFW23

Satoshiverse

In June 2022, Decentraland announced Satoshiverse: the first linked wearables in Decentraland. The Linked Wearables feature was first added to Decentraland back in April 2022 as a result of a DAO proposal. Linked Wearables are 3D representations of NFTs that originate from outside Decentraland and can be used as Wearables in-world. ^[22][23]

However, they are not regular Wearables. They do not exist inside traditional Wearable collections, they have no rarity, and cannot be sold on the primary or secondary Decentraland market. They are simply in-world representations mapped to external NFTs.^[23]

"I think the main upside and utility for our community are the social components that Linked Wearables offer. I like that now, having one of our NFTs allows a person to go into Decentraland and feel like they are their Legionnaire within Decentraland. They can actually wear their suit and walk around in it! But I think the further utility of the feature is the future potential of hosting events for our community in Decentraland. - Nico Rajco, dApps Product Manager at the Decentraland Foundation^[23]

Fanz

On September 6, 2022, Decentraland announced Fanz, the result of a Decentraland DAO grant. Fanz is an NFT event ticketing platform designed to create and sell secure Metaverse event tickets. Users can create and promote events, browse, buy, and resell tickets, and manage sales and statistics via a dashboard. Its reliance on NFTs means tickets can’t be forged. Fanz allows Decentraland’s event organizers to monetize and securely sell tickets for their events while helping users ensure they buy genuine tickets. ^[24][25]

Petaverse

Petaverse is a pet park in Decentraland and an interactive experience for pet lovers in the metaverse. It was developed by Decentraland DAO grantees, Cominted Labs. Petaverse is a playground for pets to play in, while also serving as a place users can socialize and play games. ^[26]

BeatBlox

On October 20, 2022, Decentraland announced BeatBlox, a project that encompasses a music district in Decentraland, an NFT marketplace, and an academy. The ultimate goal of BeatBlox is to make it easier for artists and their fans to connect via Web3 and to increase the user base for virtual events and metaverse music experiences. In their Metaverse Music District, visitors can participate in a wide variety of activities, such as virtual concerts, events, NFT auctions, and mini-games, as well as benefit from instructional resources. ^[27]

The three main pillars of BeatBlox are their Metaverse Music District, a place in Decentraland where artists can perform; an NFT marketplace, a place for fans to buy tunes from their favorite artists; and the Academy, a place for people who want to get insights into the blockchain world. The intention behind BeatBlox’s marketplace is that members should receive value from the unique material and presentations of the platform’s handpicked inventory of producers. To further encourage a feeling of ownership, user involvement, and direct funding from communities to artists, each user is also able to maintain a crate or individualized library to exhibit their assets on the BeatBlox platform and in the Metaverse Music District. ^[27]

Worlds

The Decentraland Foundation announced ‘Worlds on December 21, 2022. Worlds is a personal 3D space tied to Decentraland NAMEs that exist separately from Decentraland’s Genesis City and its system of LANDs. While Worlds cannot be sold or traded in themselves, they are intended to serve as a place for Decentraland citizens to build, experiment, and host events and even interactive experiences without having to own LAND. Worlds was released to lower the barriers to becoming a Decentraland creator. ^[28]

Wilderness P2E

Announced on January 20, 2023, Wilderness P2E^[29], a Decentraland DAO grantee, is a role-playing game in which players become wizards and explore a world of fantasy within Decentraland. The game was initially launched on December 21, 2021, by engineering grads Neha Singh and Ryan Pal, now CEO and CTO, who share a passion for art, design, and gaming. ^[30]

In the play-to-earn RPG, set in a universe of fantasy and mystery, players become Wizards and interact with each other through the game’s immersive Magic Combat experience. Users can navigate the game using spells and various magical paraphernalia to combat NPCs and other players in PvP mode while exploring the arcane universe and its mythical creatures. ^[30]

Metaverse Rave

On January 20, 2022, a party titled: "THE LIGHTBULB MAN - HATEF*CK METARAVE" was thrown by The Lightbulb Man \

• an NFT drop by Bjarne Melgaard on Decentraland. A video clip of the rave was tweeted by Alex Moss, a member of the Mutant Ape Yacht Club and CTO of an NFT company. The video quickly went viral and was widely mocked on social media. ^[31][32][17]

"Decentraland is one of the most bewildering places I’ve ever visited. I leave none the wiser as to why it exists, what its purpose is." - TheGamer^[16]

“You heard it here first, the metaverse is a bunch of Unity asset store characters idling around a 144p screen while listening to 32kbps royalty-free rave music” - a twitter user commented.^[32]

Jason Koebler of Vice^[31] described what it was like to experience the metarave firsthand, noting the dystopian experience was filled with frame drops and visual glitches.

“A handful of people floated 6-10 inches off the ground, travelling above the terrain without moving their legs. Strings of numbers or text or perhaps just lines floated from the ground into the blue, cloud-scattered sky but did not render."

"One person was stuck in the sky, floating but not moving.” - he reported.^[31]