Ethereum is known as the main competitor to Bitcoin and has gained popularity following its meteoric rise in value.
It is a blockchain like Bitcoin, but has added functionality – such as smart contract creation.
Unlike most blockchains, which only act as a distributed ledger, Ethereum gives users the ability to send computer code in addition to currency.
Users can therefore use the Ethereum blockchain as a decentralised virtual computer consisting of nodes around the world.
Developers have built numerous decentralised applications (dapps) on the Ethereum blockchain, many of which are funded by Initial Coin Offerings (ICO) and reward backers with tokens.
These dapps are built on transparent code stored in the Ethereum blockchain and activated by user transactions.
Decentralised Virtual World
Many types of dapps have surfaced since the creation of Ethereum, which aim to provide services in exchange for ether.
However, the developers behind the Decentraland project have a unique idea – building an open, virtual world controlled by its users.
Decentraland is a public virtual world ruled by open standards and controllable only by public consensus on the Ethereum blockchain.
Users can walk around the world in a 3D environment using either a virtual reality headset or classic PC gaming controls in a web client.
The world comprises a finite number of 10mx10m tiles of land, each with its own coordinate and hash.
Participants can purchase plots of land with MANA, an ERC20 token built on Ethereum, with a real monetary value measured in ether.
Once you have purchased your plot of land, you can create anything you want on it, including virtual casinos, games, shopping malls, and more.
The virtual world will support a number of graphics rendering engines and custom scripts, meaning there will be almost no limits as to what you can create.
Decentraland will also support P2P multiplayer and in-game communication, letting players host services for free instead of a centralised company charging for them.
Decentraland’s development is divided into four stages, described as “Ages”.
The “Stone Age” was the beginning of the project, and consisted of a simple grid as a model for the world – with pixels allocated by a proof-of-work algorithm.
The developers moved to the “Bronze Age” in March 2017, which saw the first 3D implementations using Unity as a prototype graphics engine.
Backers can also add creations to their land through the world editor. A proof-of-work algorithm is still being used to mine land directly.
On 17 August, Decentraland will host its ICO and distribute its MANA tokens over the Ethereum blockchain.
In Q3 2017, users will be able to claim the first pieces of land using their MANA tokens, and this data will be stored on the blockchain.
Before the end of 2017, developers plan to enter the “Iron Age”, adding multiplayer support and allowing custom items and scripting.
Finally, 2018 will see the project move to the “Silicon Age” and reach its full potential, described as “a fully-fledged 3D world, with full VR support and customisation of the laws of physics”.
The development team sees Decentraland being used for everything from virtual business and learning environments to immersive, multiplayer virtual reality gaming.
The development of the completed platform will depend on user and third-party input, and many features are expected to be implemented upon release – including a decentralised property market.
The Decentraland token sale will take place from 17-25 August 2017 and will allow investors to purchase MANA tokens.
Because the amount of MANA tokens increases at a fixed rate per year, and the price of land is locked at 1,000 MANA per tile, the price of MANA will fluctuate depending on the demand for land.
Once a second-hand market for land develops, however, factors such as location and content will also affect land price.
The Decentraland whitepaper outlines the funding process for its ICO in addition to providing an overview of MANA tokens and the underlying architecture of the world.
Decentraland is described by its backers as a decentralised, community-censored Second Life, which will have better graphics, more interaction, and will be more easily monetised.
It features a grand vision for VR integration and an aggressive development schedule. Anyone can walk around the Unity-driven prototype using the web app interface on the official website.