The rebranding of social networking site Facebook to Meta and its commitment to building in a metaverse has boosted the price of Decentraland (MANA), the virtual reality cryptocurrency, at the end of October.
Meta’s plan to focus on a metaverse has stoked interest, pushing MANA to an all-time high at $4.69 on 30 October. Prices have since fallen, with the coin last trading at $2.61, at the time of writing (10 November). At this level, it was up more than 3,200% year-to-date.
What is Decentraland’s cryptocurrency and what has been driving its performance so far this year?
In this article, we recap the project’s recent developments and some of the coin’s latest price predictions.
What is Decentraland (MANA) all about?
Decentraland is a decentralised virtual reality platform powered by the Ethereum blockchain. According to its white paper: “Unlike other virtual worlds and social networks, Decentraland is not controlled by a centralised organisation.
“There is no single agent with the power to modify the rules of the software, contents of land, economics of the currency, or prevent others from accessing the world.”
This platform was co-founded by Ariel Meilich and Esteban Ordano, and was launched in 2017 following a $24m initial coin offering (ICO). It was opened to public users in February 2020.
Users can buy and develop real estate in the virtual reality world using MANA tokens. This, in turn, creates a hub and drives the creation of other digital goods and services. According to Decentraland, unclaimed land can be purchased at the same exchange rate (1000 MANA = 1 LAND), and the owners of this property can trade at different prices on a secondary market in the virtual platform.
LAND can be bought by burning MANA, which will destroy the token and create a new entry in the registry.
Decentraland is governed by a decentralised autonomous organisation (DAO), where MANA token holders control the agenda and vote on policies, for example, the rules on land auctions and what types of content are allowed in the virtual reality world.
According to the whitepaper: “There are no technical specifications to what could be built in Decentraland.”
Hence, users can create advertisements, digital collectibles and interactive games in this metaverse, while “other use cases could emerge, such as training and professional development, education, therapy, 3D design, and virtual tourism, among others.”
At the time of writing (10 November), there were 1.82 billion MANAs in circulation, accounting for 82% of the total 2.19 billion supply, according to CoinMarketCap. With the coin trading at $2.61, Decentraland (MANA) crypto’s market cap stands at $4.75bn.
The original MANA supply was set at 2.8 billion, but this has been reduced as more than 600 million of the tokens were burned because of LAND auctions. According to CoinMarketCap, 40% of the MANA supply was sold during the 2017 ICO. In addition, 20% was reserved to incentivise the community, 20% went to the development team and other early contributors, and the remaining 20% was held by Decentraland.
As transactions on Decentraland are backed by Ethereum blockchains, it incurs a fee that is paid in ether (ETH) tokens. This is referred to as the “gas fee”, which is a network payment to the miner of the transaction. As a result, the higher the “gas” fee, the faster the transaction will get processed by miners. If the offer “gas” price is below market level, the transaction could be unprocessed.
In addition to the main Ethereum blockchain, Decentraland is working with Polygon (previously Matic) to create a sidechain, which will allow for a cheaper and faster transaction process. The benefits of using a sidechain are that it occurs closer to the actual time and at a very low cost. However, Decentraland advised its users to use the more secure Ethereum chain for more valuable transactions.
Different types of metaverse
Meta’s version of the metaverse might be different from Decentraland, as the former could create exclusive digital properties for the holding company and its subsidiaries in order to monetise, analyst Mason Nystrom told CoinDesk. In contrast, the user-owned Decentraland will give a free rein to its users to drive and develop revenue-making mechanisms on the virtual reality platform.
The latest Decentraland (MANA) news: all things metaverse
As an increasing number of people socialise digitally, virtual events have been steadily becoming the new normal. To further cement the rising trend of the metaverse, celebrities are creating their avatars and digital personas.
Decentraland hosted its first “Metaverse Festival” on 21–24 October, a four-day virtual event lined up with a diverse mix of music stars. One of the celebrities making an appearance was American Hilton hotel heiress Paris Hilton.
Hilton’s custom avatar, Genies, made its debut on Decentraland at the festival. Besides DJing there, Genies was also selling her clothes and accessories as non-fungible tokens (NFTs).
This was a showcase on the commercial opportunities in the virtual reality world. Other companies have also started to organise virtual concerts.
Alexander Lee wrote in Digiday: “Much like traditional concerts, these virtual spaces can then be used to sell tickets and merchandise.”
Virtual concerts such as the Metaverse Festival do not have the constraint of price or distance, which means that more users can attend which would previously have been inaccessible.
“It’s become clear that music — particularly live music — is an integral element of the growing metaverse. Virtual concerts are here to stay.”
MANA price prediction: what’s next for the coin?
Meta’s commitment to developing the metaverse is expected to drive market interest and growth in this space. As a result, some investors are bullish on the MANA coin price prediction. For instance, cryptocurrency analyst Ali Martinez wrote: “Decentraland’s MANA token is in price discovery mode and appears to be gearing up for further gains.
“A spike in buying pressure that allows MANA to slice through the flag’s upper trendline at $3.30 could signal a potential breakout. In this eventuality, Decentraland’s market value could surge by nearly 67% towards $5.56.”
Martinez warned that if Mana fails to hold above $2.60, there could be a spike in selling pressure leading to a steep correction towards $1.55.
At the time of writing, short-term technical MANA price analysis from CoinCodex was neutral, with 17 indicators giving bullish signals and 13 bearish. The service predicted that the coin could trade at $2.66 by 15 November.
For the longer term, the Decentraland price prediction from Wallet Investor was more bullish, predicting that the average price could reach $2.65 by the end of 2021, climb to $3.68 by the end of 2022 and hit $6.73 by the end of 2025.
According to DigitalCoin, the Decentraland coin’s future price could average $4.56 in 2022 and rise to $5.56 in 2023 and $7.65 in 2025. By 2028, the website predicted it could trade at an average price of $11.47, with a peak at $12.85.
The MANA forecast from Price Prediction put the coin at an average price of $4.06 in 2022, $5.74 in 2023 and $11.88 in 2025. By 2030, it expected the coin to jump to an average of $74.69.
It’s important to keep in mind that cryptocurrency markets remain extremely volatile, making it difficult to accurately predict what a coin’s price will be in a few hours, and even harder to give long-term estimates. The price of a coin could fall just as quickly as it rises. As such, analysts and forecasting websites can and do get their predictions wrong.
We recommend that you always do your own research, and consider the latest market trends, news, technical and fundamental analysis, and expert opinion before making any investment decision. You should also be aware that the past price performance is no guarantee of future returns. And never invest more than you can afford to lose.
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How many MANA coins are there?
On 10 November 2021, there were 1.82 billion Decentraland’s tokens in circulation, accounting for 82% of the total 2.19 billion supply.
Is the MANA coin a good investment?
Whether MANA is a suitable investment for your portfolio depends on your personal financial circumstances and goals. Cryptocurrencies are highly volatile investments, making them riskier to invest in than other asset classes. You should do your own research and evaluate the level of risk you are prepared to accept before investing. Keep in mind that the past price performance is no guarantee of future returns. And never invest more than you can afford to lose.
Can the Decentraland (MANA) price reach $5?
Some forecasters, such as Wallet Investor and DigitalCoin, predicted the MANA price could reach $5 before 2025. Whether you believe those predictions is a decision only you can make. Keep in mind that analysts and forecasting websites can and do get their predictions wrong.
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