Founded by Ari Meilich and Esteban Ordano in 2017, Decentraland is a virtual reality platform powered by the Ethereum blockchain in which users have full custody of the digital assets they accumulate.
The Decentraland Metaverse consists of Genesis City, a 300 LAND by 300 LAND virtual world where users may build experiences and socialize. All in-game assets including virtual LAND are ERC 721 NFTs (Non-Fungible Tokens) and the in-game currency is a native ERC 20 cryptocurrency, MANA.
Following the Decentraland Foundation’s $26 million token sale distributing MANA to the community, MANA was used to auction digitally scarce LAND NFTs upon which users build unique experiences.
Now, MANA serves as a medium of exchange for the digital goods and services users provide within the Metaverse, and is used for voting on amendments to development though Agora. MANA is also still required to use the decentralized secondary LAND marketplace where users buy, sell, and lease their LAND.
The Decentraland team held two auctions to distribute all digitally scarce Metaverse LAND — one in April 2018 and one in December 2018. Each parcel of LAND is identified with an X and Y coordinate, and users can combine up to 12 parcels of LAND to create an Estate.
There are 9 Genesis Plaza areas akin to public parks, and public roads connecting these plazas enable transportation. The initial size of each parcel of LAND was 10m by 10m — however, with a recent vote on Agora, the Decentraland community increased the size of each parcel of LAND to 16m by 16m.
As an owner of LAND, you have full creative freedom — any revenue generated by experience you create goes straight into your crypto wallet. As a result, a parcel of LAND’s location influences the types of visitors it’ll attract.
Apart from all the individual user-owned LAND, Decentraland features various districts generated by their own crowdsales through MANA. From the amount of MANA contributed, each district secured a respective ownership of LAND.
Districts are structured like a LAND trust meant to pay out dividends in the form of a revenue share to their contributors. Districts are governed by their respective sub-communities and are intended to create more cohesive user experiences by sticking to a specific design theme throughout a portion of the map as detailed below:
A few of the largest districts include the AETHERIAN project, Dragon City, Vegas City, Dragon Kingdom, Fashion Street, the Red Light District, and Decentraland University.
Decentraland Drag and Drop Builder
The Decentraland team recently announced the upcoming release of a drag and drop builder, which will enable non-technical LAND owners to develop their LAND starting in mid March 2019:
To incentivize user of this new builder tool, the Decentraland team is hosting a Builder contest that will award prizes consisting of 900k MANA, 50 LAND, and even the new HTC EXODUS 1 smartphone to winners chosen by a panel of judges.
Although this drag and drop builder is monumental in the development of the Metaverse, in order to monetize their LAND users must still design and program the Solidity contracts and tie them to their 3D builds themselves.
In order to profit from a LAND investment, users have three main options:
- Lease the LAND to someone wishing to build on it. These leases range in size and design based on the location of the parcel and the vision the leaser has for development. Typically, these leases consist of a monthly payment in MANA or ETH and/or a revenue share of the business built on the LAND.
- Build something on it to sell the assets and LAND together at a higher value. LAND with something aesthetically appealing built on it yields a higher value than just the LAND itself as the buyer has to do less development work to make it attractive to visitors.
- Build a game, shop, or advertisement that generates passive revenue. To generate passive revenue from LAND a developer must create an experience or game where users pay to use, deploy a shop that sells in-game asset NFTs such as avatar swag items or collectibles, or place a form of advertising such as a billboard.
Options 2 and 3 require the LAND owner to actually build upon it, and with the release of the drag and drop builder only option 3 requires technical contract development.
From the feedback we received from various members of the Decentraland community, we realized many LAND owners are currently constructing aesthetically beautiful designs for their LAND, but have not entirely focused on monetization. Although these designs may attract foot traffic to the LAND, the value of the visitors is largely left uncapitalized if they are unable to monetize.
We thought it would be helpful to the community to develop deployable assets in the form of games and advertisements with subsequent contracts focused on monetization. These assets will be free and easy to deploy but require a revenue share agreement that pay out both the LAND owner and the creators of the asset.
Our deployable assets will range from pay to play games, to NFT vending machines, to advertising — all which will be easy to deploy on your LAND without any technical experience.
If you are developing LAND and are interested in using some of our deployable monetization-geared assets in return for a revenue share, reach out to us.
Disclaimer: The author of this article owns MANA and LAND.