Decentraland (CRYPTO: MANA), a top-25 cryptocurrency by market capitalization, has recently attracted a lot of attention from investors.
Decentraland is powered by its native token MANA and is built on the Ethereum network. Investors are looking to MANA, the official symbol of the Decentraland match, as a recognition of the wealth produced on this system. Those looking for exposure to the metaverse’s growth in blockchain-powered games will appreciate how this token is positioned.
Indeed, Decentraland is still one of the most popular games – and tokens – on the market. Decentraland has been a five-bagger for investors over the last three months. In the long run, Decentraland has been one of the best-performing tokens in the past year, with investors receiving returns of more than 5,300 percent as of the end of November.
What is Decentraland?
Decentraland is indeed an ERC-20 token that levels of power one of the most established experimental game ecological systems that combine cryptocurrency and virtual truth. The game began as a simple 2D experience in 2016 and has since evolved into an entire 3D world with customizable land, art, activities, and much more.
Non-fungible tokens (NFTs) are unique and easily tradable digital assets stored on the blockchain used by the platform. With in-game, there seem to be 90,000 plots of property, each defined by such an NFT. This has been a significant selling point for Decentraland because it allows you to become a virtual real-estate mogul by purchasing cheap land NFTs and selling them for a profit. You can even increase the value of your property by incorporating improvements such as artwork or fun activities.
Celebrities and brands have begun to acquire property in the metaverse in the hope that they will be able to drive one day.
Decentraland is much easier to get started with than most of its competitors. It can even be run in a browser window. The game is also free to download and play, though many users are drawn in by the opportunity to invest in virtual items or land.
If you want to improve your game experience by buying land, character accessories, art, or other fun items, you must first acquire some MANA. Once you have your MANA, you could indeed search Decentraland’s marketplace for a long list of NFT items.
Decentralization is one of Decentraland’s most notable features. Voting is carried out via the Decentralized Autonomous Organization (DAO). Anybody else with a few MANA tokens or even a plot of in-game land could indeed start creating and voting on game-changing proposals. While many cryptocurrency games promise decentralization in the future, Decentraland is one of the few that delivers on that promise.
Decentraland is now a massive cryptocurrency with around $8 billion market capitalization. It has a circulating supply of 1.82 billion tokens (approximately 100 times that of Bitcoin).
While more popular tokens such as Cardano, Chainlink, and Dogecoin have much more significant market caps, Decentraland remains the second-largest gaming crypto after Axie Infinity. Since the beginning of the year, MANA has experienced tremendous growth. It soared to an all-time high of more than $5 in just over 11 months. On January 1st, 2021, you could purchase MANA for a pittance of $0.08 per token.
Unfortunately for investors holding, this high point was short-lived. As of December, the token price has settled at around $3.50.
Decentralization and Competition
The Sandbox and Axie Infinity are Decentraland’s main competitors. The use of monetary incentives helped all three projects become extremely popular, but the games themselves are unique. Axie Infinity is primarily a play-to-earn battling game, whereas Decentraland and The Sandbox each created an entirely new virtual world.
In Axie Infinity, you compete against other players using teams of NFT creatures based on the popular Pokemon series. As users progress through the game, you will mostly earn Small Love Potion (SLP) tokens and, on rare occasions, Axie Infinity (AXS) tokens. Axie Infinity allows you to make a significant amount of money directly, whereas Decentraland and The Sandbox primarily create diverse investment options.
Decentraland and Axie Infinity have astronomical start-up costs, while The Sandbox is only marginally less expensive. To play Axie Infinity, you must purchase at least three Axie NFTs worth hundreds of dollars each.
Starting out in Decentraland Land is also costly, with the cheapest available plot selling for $4,000 at the time of writing. There are less expensive accessories available, but they can still be quite expensive.
Decentraland, on the other hand, is free and incredibly simple to get started with in order to check out some of the fantastic user creations in the 3D world. The Sandbox is also free to play and even provides free voxel editing software, allowing users to create amazing items, accessories, and even entire games. It’s difficult to predict which game and corresponding cryptocurrency will perform better, but all three have performed significantly better than any of their competitors thus far.
Why do you have to buy Decentraland?
Decentraland is a game that takes place in a Metaverse
It is self-evident that Decentraland is a leading metaverse game. Investing in a blockchain-based game could provide about as much aggressive exposure as investors could ask for those interested in what the future may hold for the metaverse. Many investors are excited about the growth potential of the blockchain powering the future of virtual reality in this nascent, fast-growing space.
This should be mentioned that Decentraland is currently the largest metaverse-related virtual currency. Decentraland, which is ranked 23rd in terms of market value, is still the go-to investment for so many long-term people of faith inside this industry.
One possible explanation for this is Decentraland’s positioning as the “first-ever virtual world operated by its users,” according to the company’s website. Investors appear to value Decentraland’s first-mover advantage. Those certain high-flying metaverse tournaments, but on the other hand, are sprouting up, supplying the competitive market for Decentraland – and alternatives for shareholders.
Decentraland has largely paved the way for the development of a virtual world in which users can work, shop, and interact with friends. Provided the amount of investment that is expected to flow into the metaverse from investment firms and corporations such as Meta Platforms, this is a growth area that investors should be interested in.
A free-market economic system based on its own token
Decentraland is fundamentally a game. It is a multiplayer online world in which anyone can communicate within the space that Decentraland’s users have created. While very fascinating, this does not necessarily illustrate the significance of Decentraland’s token, MANA.
Taking a broader view of the repercussions of virtual land ownership within the metaverse, however, one can see that there is a lot of promise value to be had in owning a piece of the metaverse. High-profile multimillion-dollar land sales on Decentraland have recognized the value investors see in getting in on the ground floor of what could be the next real estate boom.
Artists are setting up virtual galleries to sell their non-fungible tokens (NFTs) and original art. Brands are opening virtual real estate stores on Decentraland. Those looking for a marketplace where they can “see” buyers and sellers of NFTs face to face have a choice.
Large institutional investors are flocking to Decentraland
Grayscale launched its Decentraland Trust in February. Given that Grayscale’s funds have primarily focused on prominent large-cap digital currencies, this move was widely regarded as “exotic.” Nonetheless, as a top-25 cryptocurrency, Decentraland has established itself as a prominent large-cap cryptocurrency in its own right.
Retail investors take notice when large institutional investors see value in a given token. As if Decentraland needed any more impetus, the possibility of additional capital flowing into metaverse-themed cryptocurrencies strengthens the case that MANA is a token with strong foundational support.
Simply put, Decentraland has gained traction. Large transactions are taking place on the framework, and large sums of money are entering the market. Decentraland is certainly making a good case as the leading platform in this regard for those looking for a metaverse virtual currency that is here to stay.
Is it wise to invest in Decentraland?
Decentraland, like most small altcoins, is an extremely risky investment. It has enormous profit potential, but it also has significant risk. If you had bought the token at the start of the year for $0.08, you would have received a massive return on your investment.
However, if you decided to invest near the peak in May, you would have lost a lot of money. This is the norm for volatile altcoins, and investors should be aware of how dangerous they can be. Before making any investment, always consider the risk/returns.
Excellent risk-reward ratio
There’s a reason why metaverse-themed cryptocurrencies like Decentraland are gaining popularity. The metaverse’s future holds a lot of people’s attention right now. Indeed, there is no doubt that Decentraland offers a plethora of reasons for long-term people to invest.
Of course, considering the amount of money that is now being swapped in these imaginary spaces, regulation dangers for metaverse digital currencies like MANA remain high. Regulators have stepped up their efforts in key global markets, with India and China recently taking tough stances on this nascent industry. These regulatory pressures do not appear to be going away anytime soon.
One of the key features that users have been drawn to with Decentraland and other metaverse games is cryptocurrency betting. As a result, this gambling exposure exacerbates the regulatory risk that Decentraland is currently facing.
However, it appears that the macro tailwinds for metaverse assets are currently outweighing the potential downside risks. Decentraland has grown rapidly in the last year, and there is reason to believe that this trend will continue. There’s a strong case to be made for Decentraland as part of a well-balanced crypto portfolio.