Decentraland Price Prediction: 2024, 2025, 2030

Decentraland (MANA): An overview

Source: Decentraland.org

Decentraland (MANA) is a fully decentralized virtual reality platform built on the Ethereum (ETH) blockchain. Within the Decentraland platform, users can create, experience, and monetize their content and applications.

The rationale behind Decentraland's creation lies in the increasing human tendency to spend more time in the virtual world. Until now, however, two-dimensional interfaces (e.g., mobile phones) have assumed strong dominance. Thus, a potential 3D world could enhance the virtual reality experience by leveraging its immersive characteristics to create a cluster of communities.

MANA

Source: Decentraland.org

MANA is an ERC-20 token and is Decentraland’s native cryptocurrency. The original total supply of MANA was capped at 2.8 billion, which was reduced with time to 2.19 billion. As of October 2023, 1.89 billion MANA are in circulation.

A notable aspect of MANA's tokenomics is the mechanism of burning tokens, which is instrumental in reducing the overall supply over time.  

MANA serves multiple purposes within Decentraland:

• Users employ MANA to purchase parcels of virtual land known as LAND.
• MANA is used for buying, selling, and trading assets in the Decentraland marketplace, including wearables and collectibles.
• The token facilitates engagement in various activities within Decentraland, like attending events or playing games.
• Specific areas within Decentraland are frequented more due to user interactions, games, events, or shopping, creating opportunities for advertising and brand development using MANA​.

Wrapped MANA (wMANA)

When users lock up their MANA tokens in the Decentraland DAO, these are converted into wMANA, which is used for voting in the governance process of Decentraland​​.

How does Decentraland work?

Source: Decentraland.org

In essence, Decentraland represents a virtual reality ecosystem where people can buy LAND, which is an ERC-721 token or non-fungible token (NFT) representing a piece of the virtual map. 

The land is divided into parcels that are identified by cartesian coordinates (x,y). Each basic plot of LAND is 16m x 16m or 52ft x 52ft, though users can combine multiple plots to create larger estates.

The parcels are permanently owned by members of the community and are purchased using the native token. This paves a path toward complete control in the hands of the users over the applications they create. Initially, LAND could be purchased during Decentraland's public auctions. Now, it can be bought and sold on secondary markets or through peer-to-peer  (P2P) transactions.

Additionally, while not a token, there's the concept of wearables within Decentraland. These are customizable avatar items that users can buy, wear, and trade. Some wearables are ERC-721 tokens (similar to LAND) and can be easily traded on the Ethereum blockchain.

Here’s an outline of the platform's architecture:

Consensus layer

Central to maintaining a trustworthy digital record, the consensus layer tracks LAND ownership in virtual realms. It ensures transparency and verifies the rightful ownership and content of each parcel, creating a decentralized and reliable registry system for virtual properties.

Land content layer

This layer focuses on the assets placed within virtual lands. It allows users to download and interact with assets using a decentralized distribution system, ensuring that content is accessed and shared in a P2P manner without centralized control or interference.

Real-time layer

Vital for enhancing user experience, the real-time layer facilitates interactions between users in the virtual world. It enables world viewers to connect, interact, and share experiences seamlessly, making virtual spaces feel as vibrant and dynamic as physical interactions.

Additional key systems

• Payment channels: These enable fast, low-risk in-world purchases and also help incentivize quality service delivery, promoting a seamless transaction experience within Decentraland.
• Decentralized identity systems: This system ensures content creators are recognized and rewarded. Linking public keys with names, it provides a layer of ownership, promoting unique content creation.

History of Decentraland

Source: Decentraland/Twitter

Decentraland was conceived in 2015 by Argentinians Ari Meilich and Esteban Ordano as a proof-of-concept for assigning digital real estate ownership on the blockchain. 

The journey began with the Stone Age, where digital real estate was represented by pixels on a 2D grid. Each pixel identified its owner and color. This was the basic foundation of digital ownership.

The project then advanced to the Bronze Age by late 2016. This phase introduced a 3D virtual world segmented into land parcels. Users could access and view content for each land parcel using Distributed Hash Tables and BitTorrent. 

The Iron Age aimed to transform Decentraland into a bustling virtual society. It envisioned a platform where developers could build applications, making the digital space interactive and monetizable. 

This phase introduces P2P communication, a scripting system for interactivity, and a rapid cryptocurrency payment mechanism.

Decentraland initiated a token sale through an initial coin offering (ICO) in 2017, during which they raised a total of 86,206 ether (about $26 million at the time). The marketplace and LAND estates were introduced in 2018. Finally, in 2020, the platform went public.

The pandemic further bolstered the platform's growth, with more and more people and brands associating with the oldest metaverse. 

As per a recent McKinsey & Company report, global spending in the metaverse could reach $5 trillion by 2030. This report goes on to expand the value creation prospects in the metaverse. It further states: 

“It has the potential to impact everything from employee engagement to the customer experience, omnichannel sales and marketing, product innovation, and community building.”

These outcomes could ultimately put Decentraland in an excellent position to capture a sizable portion of the increasing market. Even after extrapolating the projected growth on a yearly basis, Decentraland's growth potential for the coming months seems quite promising.