Administration of Decentraland
DAO (Decentralized Autonomous Organization)
DAO stands for "Decentralized Autonomous Organization". The Decentraland DAO is the virtual world's decision-making mechanism for MANA, NAMES (1), and LAND holders. It was created using technology from Aragon (2). The community can give grants and modify the lists of banned names, POIs (3), and catalyst nodes (4) by voting in the DAO. In addition, by voting, token holders can make the decisions that impact the content and future operation of the platform. The Decentraland DAO owns the most important smart contracts and assets that create Decentraland – the LAND Contract, the Estates Contract, Wearables, Content Servers, and the Marketplace. It also has a sizable MANA purse, allowing it to be genuinely independent as well as fund numerous Decentraland activities and programs.
The DAO allows for two general proposal types: proposals with direct binding actions (that will result in changes made to Decentraland’s smart contracts on the Ethereum network) and governance proposals. Regarding governance proposals, the voting process includes three steps: a Pre-Proposal Poll, a Draft Proposal, and a Governance Proposal. Each tier will have increasingly higher submission and passing standards (based on Voting Power) to guarantee that a representative majority takes significant governance choices. Each step must exceed the stated VP level to advance to the next stage.
The weight of your votes is determined on your account's voting capacity.
There are three sources of power that influence the voting power of each account.
- Wrapped MANA: MANA that is converted to WMANA and is temporarily held by the governance contract. For each unit of WMANA that you hold, you get one (1) voting power unit.
- LAND parcels: 2000 voting power units per parcel.
- Estates: 2000 voting power units per parcel in each estate. You must also register your LAND and Estate tokens for voting purposes. One more thing, Voting Power is based on the number of assets you have. However, your property number changes after the vote, and your Voting Power number will remain unchanged.
Security Advisory Board (SAB)
In addition to the DAO, Decentraland has a Security Advisory Board (SAB) that oversees the security of the platform's smart contracts, reviews governance recommendations, and responds to bug reports. SAB consists of five members elected by the Decentraland community. The SAB can pause, resume, or cancel any action the DAO Committee takes.
The DAO Committee is a group of three trustworthy persons chosen by the community to manage keys in a multi-sig wallet. Any passed votes having a binding action, such as financing a Grant, banning a name, adding or deleting a POI, adopting a Governance proposal, or establishing a Catalyst node, are carried out via this multi-sig. The DAO Committee is overseen by the SAB, which has the ability to pause and cancel any action initiated by the Committee. The DAO's security is ensured through the use of a multi-sig wallet controlled by a committee of trustworthy individuals and the fact that passed proposals result in on-chain action. On top of the DAO Committee, the SAB owns a second multisig that offers a second tier of safety.
The Decentraland protocol is comprised of three layers:
- Consensus layer: Track land ownership and its content.
- Land content layer: Download assets using a decentralized distribution system.
- Real-time layer: Enable users’ world viewers to connect with each other
The network's foundation is built on the consensus layer, which establishes land ownership through the LAND smart contract and token system. Each LAND record also includes a hash that points to the file that provides information on each piece of land. The content layer, which includes detailed characteristics of a land parcel, such as descriptions of objects, textures, and sounds, as well as scripts governing how the content is put and behaved in the parcel, contains files connected to LAND entries. These files can also contain additional information, such as scripts for user interaction and a connection to servers for peer-to-peer communications. The platform stores data on the IPFS network and retrieves it via connections in the consensus layer. The real-time layer will allow users to interact with items and other virtual world players. All interactions on this layer will take place through peer-to-peer connections, with servers maintained by landowners or third parties, eliminating the need for centralized servers. The figure below shows a diagram of the steps the Decentraland clients execute to provide the experience of a shared virtual world in a decentralized way.
Additionally, two other systems are essential for Decentraland’s economy to develop:
- Payment Channel Infrastructure for fast payments with low fees.
- Identity System that allows users to establish ownership over original creations.
Operating costs and challenges
Decentraland's content is distributed across a decentralized peer-to-peer (P2P) network rather than housed on a centralized server infrastructure. Users of the Decentraland P2P network cover the expense of hosting the platform's contents and bandwidth with their own money. The project intends to create a protocol to fund long-term infrastructure expenditures, with profits from MANA token sales being used to do so.
Decentraland is a virtual reality game built on the Blockchain platform. The foundation's members can elect representatives, purchase land lots, conduct transactions, buy and sell products and services, and vote on governance. Decentraland's token has a genuine and internal value, allowing it to be traded on the open market. Ethereum, in essence, is the lifeblood of the Decentraland system, connecting its economics, technology, and ethos. Decentraland's metaverse has evolved into a thriving environment with new features added on a regular basis by its community.
Read more about the Decentraland in the article"Introduction to Decentraland (part 1)"
 Decentraland white paper, decentraland.org, accessed April 14th, 2022.
 Decentraland: Peek Into The Metaverse, eattheblocks.com, accessed April 14th, 2022.
 Decentraland (MANA) price prediction: will the token rebound?, capital.com, accessed April 14th, 2022.
(1) NAMES: The contracts used to mint the NFTs for unique avatar names in Decentraland
(2) Aragon: Aragon is an open-source software used to maintain and create decentralized autonomous organizations (DAOs) on the Ethereum blockchain.
(3) POIs: The list of Points of Interest (notable locations in Decentraland that are advertised to users as good places to begin exploring the virtual world) is also owned by the DAO. This list is stored on a contract and can only be modified after passing a vote by the community that is then enacted on-chain by the DAO Committee.
(4) Catalyst Nodes: The list of Catalyst nodes that serve content and establish the peer-to-peer connections needed to keep Decentraland’s virtual world running is also owned and controlled by the DAO. This list is kept on a contract and may only be changed following a community vote, which is then carried out on-chain by the DAO Committee.