What is Decentraland and how does it work?

Decentraland is an open online world. It is similar to Secondlife although the technology on which it is based has little to do with it. Even so, if you know Secondlife, everything I’m about to tell you will give you a Déjà vu….although Decentraland…. is superior.

Decentraland is an open online world, everyone with a web browser can enter and interact in this world…yes yes, but, concretely …. what is it and how does it work? In this article I will explain it in a very detailed way…

What is Decentraland

Although it is not officially defined as a videogame, it is something similar, it is an open world where everyone can enter through a browser: Chrome, Firefox, Edge, Safari, Brave, Opera, etc.

They briefly define themselves as follows:

“Decentraland is a decentralised virtual reality world supported by the Ethereum blockchain. With the Decentraland platform users can create, experience, and monetise their content and applications.”

Decentraland has been created by Argentinean engineer Esteban Ordano..

It can be played with VR (virtual reality) glasses but also from a simple PC (from a smartphone at the moment it is not possible, besides the game needs a lot of power, but they have officially indicated that in the future it will be available for mobile devices as well).

You can log in with a character, which is a human doll, male or female, with the possibility to customise it and you can move around the Decentraland world, walking or teleporting if you want to go far away. You can literally start interacting in a minute, no registration required.

There are 90.000 plots, each one is 16×16 meters, this surface is possible to calculate because the dolls that we use as avatars are taken as a reference, so it would be 16x16m each plot in proportion.

In the different plots you can build all kinds of things, absolutely everything from mazes, games, contests, real casinos, exchange houses, shops of all kinds, squares, buildings, forests, etc.. You can even buy advertising posters that users will see, I have already found one by chance, if you click on the game the browser asked me for permission to open the link to a cryptocurrency exchange house. It’s like an absolute parallel with real life.

Serenity Island, a casino in North Decentraland.
Gambling on Serenity Island.

There are public squares, which are huge plots of land where the initial developers of the game build, as well as public roads that roughly connect the map and cannot be built on.

Map of Decentraland, green squares are public squares, states in blue, public roads in grey. 90.000 plots.

Private plots, which are the majority, can only be built by the owner(s). If it is a single owner it is as easy as choosing what he wants to do and either doing it himself or hiring someone to do what he wants. If there are co-owners then a DAO mechanism is used to vote and make decisions.

Owners of plots of land can join together and form an estate.

Historical Events of Decentraland

  1. 2015

    Decentraland was created

  2. August 2017

    $20 million was raised through the Initial Coin Offering (ICO).

  3. December 2017

    The first “Land” or plot was auctioned.

  4. March 2018

    Decentraland’s marketplace opens, where everyone can buy and sell their properties without any kind of restrictions.

  5. June 2018

    Developers start building on the plots.

  6. April 2019

    Avatars with passports will be available soon.


How Decentraland works: “powered by Ethereum”.

Decentraland is a “Dapp”, i.e. a decentralised application, although not fully decentralised.

Decentraland is powered by blockchain technology, specifically Ethereum. As you may already know, Ethereum is the second largest cryptocurrency in terms of market value in the world, only behind Bitcoin, and it has the particularity that it is not only a value transmission chain like Bitcoin, but also a decentralised computing network that allows for such things as smart contracts, which is what Decentraland uses.

In short, smart contracts are nothing more than computer programmes whose execution is carried out on the blockchain and therefore have very important characteristics of security, immutability, impossibility of being stopped, event-driven execution, etc.

Smart contracts allow for tokens such as NFTs (non-fungible tokens) that are governed by Ethereum’s ERC-720 standard. That is, they are tokens that cannot be divided, and that contain unique valuable information, so in Decentraland there are items that personalise characters, plots (land), names, and avatars (characters), all of which are ERC-720 tokens and are therefore contained in the Ethereum blockchain.

For example, there are 90,000 parcels, all of which are NFTs that once you buy them, they stay in your wallet and no one can take them away from you, modify them or anything else, as would happen with Ether or Bitcoin.

The same applies to your avatar.

And all these goods can be traded, and at the time of writing the cheapest plot that can be bought on the market is about 500 dollars. Not because the developers are selling them at that price, they were sold some time ago at an event they called “terraforming” and that is the market price, as there is a very strong demand for the exploitation of the plots by fans and companies.

Is that price justified? In my opinion, no, Decentraland does not have the potential to generate enough profitability to make these prices acceptable from a profitable and business point of view, in general terms of course, there are businesses that may be able to do so, but I cannot know that and it is not the subject of this article.



In 2018, 3 plots were sold, the most expensive being 2,000,000 MANA, which translated into dollars at the time is $175,578.
The plot sold was very close to one of the main squares of the virtual world, and here, as in real life, the more central and close to relevant enclaves, the more valuable and therefore more expensive the land will be.
Capture of the plot on the Decentraland map:

In addition, plots were sold at similar prices, but today there are much more expensive plots for sale and sets of plots or estates that easily reach $200,000 and much more.

But we don’t need to buy plots to use the game, as our free or paid avatar is enough.

However, if you are excited about creating a scenario in Decentraland there are alternatives such as: wait for the prices to go down (the last few days have gone down), associate with friends to buy one, associate with some of the “States” that already exist, in which you pay a part and have a vote in the decision making on that plot in proportion to the amount contributed (with the MANA token that we will see now), and finally propose an idea or something you want to create to the project developers, if they like it, they will help you to get a plot with money or giving you part of the ones they have in reserve. They themselves invite the public to the latter, because they obviously want to attract interesting projects to Decentraland.

Here you can see a scene from “2001: A Space Odyssey” with a game, the “Sci-fi” square, the state of “Silicon Valley” where blockchain companies have opened their headquarters and give conferences such as the company Matic, among others, there are also art galleries where you can buy and sell.


The free avatar will simply limit our interaction with the environment, I recommend buying one, it only costs 4$ and you have it for life in your wallet. I also recommend using the Metamask extension which is available for Firefox, Chrome and practically all web browsers, although if you use the Opera or Brave browser you won’t need Metamask as both have a wallet by default.

Here you can see in real time their unit price and total capitalisation:

#NamePriceMarket CapChangePrice Graph (24h)

That is to say, avatars are paid in MANA, but you don’t have to pay it to someone in particular in the case of avatars, it’s just the cost of storing it in the blockchain and a commission for the community. On the other hand, plots, names or special wareables to customize the avatar (hat, glasses, etc) you have to buy them from another user using the Decentraland marketplace or other secondary marketplaces such as Opensea.

Also to vote on the community you use MANA, you don’t spend MANA to vote, it’s just one MANA = 1 vote, but you keep it, it doesn’t cost money to vote, it’s just that the more MANA you have in a district where you collaborate, the more votes you get. It’s fair because that way the votes of those who have more money invested in the project count more, someone with 100 MANA is probably not going to vote as carefully as someone who has 10.000 MANA.

However, within Decentraland, as I said, there is premium content if someone wants to upload it on their plot, as well as real cryptocurrency casinos, exchanges, art galleries where you can buy works, and a long etc., where payments are made in the cryptocurrency that the merchant accepts, as is logical, although it is often with MANA.

Useful links:


How Decentraland works on a technical level

On the one hand we have the users, names, wareables, avatars, and lands, all stored immutably in the Ethereum blockchain, then we have a network of servers that are not provided by the company itself but by communities of users.

When we access our web browser with an Ethereum browser such as Metamask, what the server does is to read our address, verify it, and “translate” its content, such as the avatar for example.

Furthermore, within Decentraland it is possible to create Dapps using smart contracts, which allow, for example, to play in a casino, without the possibility of cheating as the code is public, as well as having no intermediaries in principle.

When 2 parcels are joined together you can declare state, states if they have more than one manager decisions are made in the DAO (Decentralized Autonomous Organization), as I explained 1 MANA = Vote, when you vote you don’t spend MANA, but you can only use your MANA tokens in the state you decide to put them to service, you can’t vote 2 times the same vote using the same tokens, it is technically impossible thanks to the blockchain.

Is Decentraland really a Dapp? Yes and no. Depending on how strict we are, although it is true that the servers are provided by the community and there are different groups of servers, I cannot consider it decentralised because it does not run like the blockchain through incentives and with an impassable and immutable infrastructure, in addition the Decentraland domain itself is: “decentraland.org”, a true Dapp has a decentralised domain or lacks it using another protocol. But to date there are few applications that are truly decentralised, although more and more are becoming 100% decentralised.

My opinion about Decentraland

In my opinion Decentraland is a project with a lot of interesting things, but the fact that it tries to cover so much can have a negative impact on the project itself. Secondlife has survived for decades, and in my opinion, Decentraland is a much more powerful bet, thanks to the crypto world. Because unlike Secondlife, Decentraland is owned by the community itself, from the space to the avatars, and because it’s so open, everyone can create for very different goals: from games of all kinds to on-site businesses.

Moreover, the fact that no identity is required beyond an Ethereum wallet such as Metamask or the Opera and Brave browsers, among others, makes it easy for everyone to access and relatively anonymous (it is not total).

And of course, thanks to its integration with the blockchain, it allows you to do things that you could not do in Secondlife, such as unregulated casinos with total security that they do not cheat, using smart contracts, and a huge number of doors that this technology opens beyond gambling: smart contract-based games with prizes, advertising, art galleries, collectible shops, etc.

Beyond the possibilities, I do not dare to say with total certainty to what extent the idea will succeed, but what is certain, for the moment, is the enormous community behind it, which is creating in the states diverse worlds such as: Silicon Valley, Satohi’s Castle, cyberpunk cities, racing games, even adult content. A whole world.




External links of interest to Decentraland

    • Decentraland official website.
    • Documentation (what is Decentraland, ethereum wallet, how to build, basic tips, etc).
    • Decentraland White Paper.
    • Marketplace Decentraland.
    • Secondary marketplace on Opensea.


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