Is Decentraland Overvalued?

Feb 22, 2022

[Xangle Digest]
By Moon Bit
Translated by LC



  • Contrary to the price and trading volume of MANA tokens, the number of daily users is only around 2,000
  • How long will it hold the Metaverse’s first-mover advantage when a wave of new models come to life in the future?


The Endless Possibilities of Metaverse

[Source: Samsung Electronics America Twitter]

Samsung Electronics America’s announcement in Jan 2021 to open its first flagship 837X store in Decentraland and Facebook’s decision to rebrand itself as Meta are important moves for the future of the Metaverse. However, Decentraland holds an advantage due to its first-mover status, once reaching a $10B market cap.

[Decentraland NFT Price & Trading Volume, Source: NFT Statistics]


[Decentraland NFT Statistics in the last 7 days, Source: NFT Statistics

Affected by the PFP (profile photo) NFT trend, Decentraland is currently ranked 29th in the Opensea Top NFT Rankings by trading volume. However, Decentraland and The Sandbox are still the biggest names in the Web 3.0 worlding, showing high trading volume and 4.8 ETH floor price. The MANA token also shows a high trading volume close to $1B based on the 24-hour trading volume.


A Leading Worldbuilder with Disappointing Number of Daily Users

[Refer to "Total Users" in the bottom left, Source : catalyst-monitor]

Although Decentraland is currently the number one out of all other virtual worlds available today, there might come a time when other companies manage to wrest away the top position. There may be various indicators for determining the success and sustainability of game services, but the most conclusive indicators are the active user base and the number of daily users. According to NAVVIK, a video game research company, Decentraland has a monthly active user base of about 300,000, and the highest number of daily users is 2,500. In contrast to Decentraland's transaction price and volume, the number of daily users is only around 2,000, which seems a little insufficient for this immersive digital world with a market cap of $6B (as of writing).


Going Forward

In Decentraland, Landowners can create interactable assets such as casinos, *Dcommerce (digital commerce, a virtual mall), galleries, and games on their land. If Decentraland fails to attract new users while capturing as many users’ attention span as possible with their product, the quality of the content will deteriorate going forward. In a situation where no one can say for certain that new digital realities that combine the Metaverse and P2E will not come out, Decentraland has an uphill battle to fight for market dominance. Let’s see how the Metaverse’s early mover will play out its strategy to secure more users and build a sustainable Metaverse.

*Dcommerce : Virtual mall or flagship store that allows players to exchange virtual assets purchased as non-fungible tokens (NFTs) with physical goods.


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