Decentraland’s manna token ($MANA) has been trending downward since the start of 2022. The 2017 IDO price was $0.01 per MANA and peaked in late November 2021 at $5.90. The price as of writing is $1.43, signifying a 75% drop from the ATH.
So what exactly happened? Is this good news or bad for Decentraland? And why did the MANA price spike so much earlier than expected? In this article, we’ll explore the causes behind the recent rise in the MANA token price and evaluate the context of app development to determine if this means good things are ahead for the popular decentralized metaverse. Lets’s cover what the MANA price drop means for Decentraland.
Why is the MANA Price Dropping
This might seem like an odd statement given that the MANA price quadrupled late last year. But there are some key reasons why the MANA price continues to loose support.
Crypto Market Trending Down
Many cryptocurrency prices peaked late in 2021 after a major bull run following the low prices of the onset of the pandemic in 2020. Many say “prices don’t matter”, primarily because they are interested in adoption as a way to value crypto assets. It isn’t clear whether it is a bear market for the next couple of years, or if it is a temporary correction that will lead to a run-up in prices again.
Fading Popularity and Interest
The hype cycle can only last so long before consumers move on to different products and projects. Decentraland is the most well-known metaverse, but it cannot compete with Meta and Facebook. Both of these brands are widely recognized as global leaders. Decentraland is a small-fry.
While the exact reason behind this decrease isn’t known, one possible explanation could be that investors felt more comfortable transferring their funds to other platforms due to the increased competition between exchanges. Another possibility is that traders simply became frustrated with having to deal with multiple exchanges and withdrew their funds from Decentraland altogether.
Problems with Decentraland
Now that we’ve looked at some potential factors influencing the MANA token price, let’s talk about what problems Decentraland actually faces.
Scalability and Downtime
One of the biggest issues facing Decentraland is scalability. As of now, it can process approximately 50k requests per second and can handle approximately 10k users simultaneously. While the platform is currently not experiencing any downtime, should the user base grow exponentially, it may soon face serious performance issues.
Finally, while Decentraland claims to offer full privacy protection, it doesn’t fully protect user data against hackers. For example, the platform doesn’t encrypt communication between your browser and the servers. If you’re using Chrome, it also stores cookies allowing companies to track your online behavior.
In summary, while Decentraland offers great features and flexibility, it still needs time to mature and improve upon various aspects. As such, it’s worth keeping tabs on the platform to see if it eventually becomes stable enough to support large crowds without crashing.
With all of the above in mind, it’s clear that Decentraland hasn’t quite hit its stride yet. However, there’s hope for the platform’s long-term success thanks to its unique approach to blockchain technology.
Is Decentraland built to last?
Decentraland runs entirely on top of the Ethereum protocol and doesn’t require a central authority to function. Since the MANA token isn’t needed to access the platform, it doesn’t need to be traded on centralized exchanges either.
And finally, Decentraland’s governance model makes decisions regarding the platform’s direction easier for everyday users. Rather than relying solely on venture capitalists to decide everything, it gives regular folks a say in how the platform operates.
Thus, Decentraland’s approach to blockchain may turn out to be revolutionary, especially considering how popular the concept of self-sovereignty has become recently.
Is the Metaverse hype cycle over?
All told, it seems as though the Metaverse hype cycle has ended and that most users don’t really care about Decentraland anymore. At least not enough to buy the MANA token or download the Metaverse app as indicated by bearish sentiments on Twitter. It seems that corporate shills and product placement may be too obvious and prevent the platform from becoming a truly integrated consumer experience.
Hope Remains for the Metaverse and Decentraland
As mentioned earlier, Decentraland’s primary issue right now is scalability and frictionless on-boarding. Once the platform reaches its true capacity and requires minimal friction for others to join; it could revolutionize the way we think about blockchain technology. Decentraland and MANA need to be as easy to use as turning on an Xbox in order to really take off.
Builders Remain on Decentraland
Many people are still building on the metaverse, such as world famous hotel groups. It could help us develop better in-game experience and allow anyone, anywhere to experience new methods of interaction. These novel experiences could bring new people to the metaverse. AMBCrypto even reported that collaborations will be created with Amazon and Samsung, which could lead to future events or experiences.
But perhaps the greatest benefit of Decentraland’s approach to blockchain is its ability to give everyone control over their digital identity. Rather than being trapped within the walls of a single service provider, individuals could take ownership over their personal information and use it in whichever way they please.
If successful, Decentraland could potentially change the world and make blockchain adoption more widespread.
What do you think about the current state of Decentraland? Will the MANA price continue to plummet or rise? Let us know, leave a comment!