Cryptocurrencies, blockchain, NFT and new trends

The Final Word on Decentraland’s Numbers

Counting users in the metaverse is tough. CoinDesk scoured and analyzed multiple data sources to distill an answer.

Avatar in Decentraland (Decentraland)

Is it 38? 650? 7,000?

It’s tough doing a census of the metaverse.

Try as we might, CoinDesk, in the eyes of Decentraland’s fans, just couldn’t get the numbers right.

Metaverse platforms such as The Sandbox and Decentraland present a challenge of sorting bots from real people, and then even real people can be inactive or AFK, short for “away from keyboard” for hours, days, even weeks. One way to filter out bots is to filter users by those with non-fungible tokens (NFT), which also weeds out “tourists” who pop in for a quick look and leave without meaningful interaction. In addition, it can be argued that those users with NFTs matter the most because in a Web3 metaverse like Decentraland, users with NFTs such as ones that denote ownership of real estate in Decentraland (LAND) or wearable items that unlock some of the more popular experiences like ICE Poker are the ones who are most active in the platform, and certainly are the most valuable to the ecosystem’s success.

Another challenge in determining how many active users there are in Decentraland, despite there being an abundance of open-source data available on the blockchain, comes down to the fact that Decentraland and MANA token holders have a vested interest to make sure this number appears as large as possible. Certainly, publishers including Electronic Arts or Activision Blizzard want to see a high level of active players on their games such as Battlefield or Call of Duty, but their stocks have other fundamentals behind them and don’t rely on the rise and fall of a single game or platform. These games also don’t have the problem of idle bots that hang out to inflate the player base.

Hop into a session of either of these traditional games and you’ll be greeted with action from the moment you arrive. But log into Decentraland and you’re dropped into an apparent ghost town. There are players on there, and more in certain areas, but are they active?

So in order to figure out just how many active users there are on the platform we used every available tool out there to try and track this down, from DappRadar to Atlas Corp.’s data repository (which powers DCL-Metrics), to the open-source Catalyst Nodes Monitor, DappRadar and Nansen. We even tracked how many players went to the much-hyped Metaverse Music Festival thanks to Atlas Corp.’s data.

It’s important to remember that with one exception, which we’ll address later, these aren’t CoinDesk’s numbers. We’re reporting them directly from the source.

Here are the results:

CoinDesk - Unknown

Now we’ll dive into the details.

DappRadar: The #38DAUS and the players behind them

DappRadar’s Numbers:

  • 38 (Original), 775 (Revised)

In the days that followed CoinDesk’s publication of DappRadar’s estimated daily active users in Decentraland, community members were quick to defend their beloved metaverse platform.

Some Twitter users called the story “fake news,” “poorly researched,” and that the “PayPal should fine [CoinDesk] $2,500” for spreading misinformation.

The chaos that brewed on Crypto Twitter led Decentraland to publish its strategy to define an active user of the platform.

It said in a tweet that it counts its “active users” as individuals who move from one “parcel” of land to another during the span of their gameplay, rather than tracking smart contract interactions through wallet data. Given this definition, it pointed out that it has 60,000 “monthly active users.”

The same day, DappRadar issued a statement reframing its data collection process, changing the metric of “Daily Active Users” to “Unique Active Wallets,” to more specifically define smart contract transactions within the metaverse world.

However, despite Decentraland’s clarification and DappRadar’s statement, some users pointed out that in the greater context of gaming platform user metrics, the metaverse platform’s numbers appeared low.

“[60,000] is still rather unimpressive. Given it being a whole world, is [60,000] people a lot?” said Twitter user @JbaumannD.

Decentraland said in a tweet that its user numbers have been lower than the “early metaverse hype of late 2021,” and that the community behind the platform is slowly building.

What started as a handful of Decentraland developers pointing out the inaccuracy of the platform’s low numbers eventually led users to create a meme, expressing their undying love for the metaverse, no matter how many users it might have. Creating the hashtag #38DAUs, users encouraged community members to play games, attend upcoming events and interact with each other in Decentraland.

“Wouldn’t it be so much better if we could flip this into an opportunity; where the happenings of this pioneering, decentralized space are accurately documented in style?” said Sean Ellul, co-founder of Web3 design firm Metaverse Architects, said in a tweet.

Ellul is a vocal Decentraland community member, advocating for developers and bolstering the community. In November, Ellul authored a governance proposal to pause its grants program in light of the FTX collapse.

A small (but mighty) community, or a PR stunt?

While some Decentraland users come to the platform to play games or attend events, others are inspired by the community that’s associated with being an “active user.”

Matthew McMillian, founder of metaverse game Dice Masters and co-founder of Web3 social platform DCL Dating, told CoinDesk that the major reason for his presence in Decentraland is the community within the metaverse. He said in the beginning of his exploration of the platform he spent eight to 12 hours a day in Decentraland, making connections with other users while there.

“I try to go to different metaverses, and I haven’t really seen a community that’s as passionate and together as I’ve seen within the Decentraland community,” McMillian told CoinDesk. “If creators can build their communities and then start building economies around their communities, we’re all you know, kind of contributing to the same thing that it’s, like … we can create a real economy.”

While the community might keep some users coming back to Decentraland, its robust lineup of brand activations in 2022 welcomed new avatars to the platform.

March’s Metaverse Fashion Week brought in Estée Lauder, Dolce & Gabbana, and Forever 21 to host a week-long digital wearable experience. October’s Metaverse Music Festival included performances from Ozzy Ozbourne, Dillon Francis and Soulja Boy. Additionally, Decentraland has been home to activations such as Snapple’s Bodega, and Norway’s central tax authority’s office.

On Dec. 16, Bing Crosby’s estate opened its Winter Wonderland in Decentraland. The activation features holiday games, digital Christmas sweaters that avatars can wear and a museum dedicated to Crosby’s life. Crosby was “a firm believer in the wonders of technology,” according to Harry Crosby, the singer’s son.

CoinDesk - Unknown

Rob Dippold, partner and president of Digital Strategy for Primary Wave Music, the company that partnered with Crosby’s estate to host the activation, told CoinDesk that the 10 day-long activation aims to bring a new life to Crosby’s work and enable fans “to easily experience the wonders of a metaverse for the first time.”

While the “wonders” may come and go, all pop-ups must come to an end. So the question remains: While these ephemeral experiences in the metaverse may attract new users, what entices them to come back?

Atlas Corp.: Forcing transparency on Decentraland

Atlas Corp.’s numbers:

  • 810 (Oct. 7, 2022 snapshot)
  • 3668 (Metaverse Festival, NFT holder)
  • 6,080 (Metaverse Festival, no NFT)

One of the loudest critics of CoinDesk’s reporting of DappRadar’s numbers was Miami-based Atlas Corp., calling it misinformation. In the initial aftermath of CoinDesk’s report on DappRadar’s numbers, Atlas Corp. said that there were 8,000-10,000 daily active users on Decentraland.

While an article by PC Gamer called out that DCL Metrics (where Atlas Corp.’s data is published) is “a platform created by Decentraland to report user data, so take it with a grain of salt,” that isn’t entirely accurate and lacks an understanding of how decentralized autonomous organizations (DAO) operate and fund things.

Atlas Corp. and DCL Metrics are both funded by grants from the Decentraland DAO that were proposed and voted on by holders of one of the DAO’s governance tokens, MANA, NAMES or LAND. This isn’t the same as Decentraland’s executives funding it themselves – it’s an arm’s length operation.

In fact, as Atlas Corp.’s co-founder, Avi Aisenberg, explained in an interview, it was a bit of an uphill battle to get the Decentraland Foundation to respect the need for transparency.

“If I had a single word to describe the Foundation it is opaque, which as you can imagine makes it difficult to build relationships. There is little public information on how it’s structured, operated, funded, etc. Over the course of two years, through our own investigative research, we’ve been able to learn a lot and it’s only added fuel to the Atlas Corp. fire,” he said via email.

Aisenberg said the Decentraland Foundation didn’t view transparency as important in the past, and Atlas Corp. effectively goaded it to begin sharing data – a forced transparency that benefits the community.

“Our methods are known yet we’ve had to stand our ground on multiple occasions to ensure access to the data is open, preventing breaking changes that would ultimately lock out the community from having the same level of access to the data as the Foundation and the DAO node operators,” Aisenberg continued. “I often wonder what it is that team was up to in the past.”

Crunching their numbers

When covering numbers from DappRadar and other tools, CoinDesk reported exactly what was being presented. But for Atlas Corp.’s numbers, more work was required. This is the exception to directly presenting the source’s raw numbers we mentioned at the start.

While Atlas Corp. advertises 8,000-10,000 active users that number needs to be picked apart in order to get an accurate figure of active users. There are a few red flags, including the huge variance of the 8,000-10,000 figure from the other data sources, as well as the number of “Marathon Users” on DCL-Metrics, which shows a large group of users are spending close to 24 hours on the platform. Finally, there are a high number of users that are listed as “away from keyboard” (AFK) in some of the scenes, including the most popular location, ICE Poker:

CoinDesk - Unknown

So in order to account for all of this we need to perform some filtering on the raw JSON (a type of database file used for web applications) provided by Atlas Corp. of a snapshot from Oct. 7, 2022, which contained a list of wallet IDs and time on site. We used a Python Script to convert this into an Excel file while extracting user names and the presence of NFTs and aligning this into columns.

In order to find a more realistic number, we wanted to filter the following:

  • Figuring out the time spent “away from keyboard” (AFK). We did this by subtracting the average time spent from the average time spent away from keyboard, which DCL-Metrics provides in its ‘scenes’ section. We then averaged it out across the entire set of scenes. The result is 24 minutes, which we rounded up to 25.
  • The presence of an NFT in a Decentraland wallet is also an effective proxy of who is really an active user, as earlier noted. An NFT is needed to play ICE Poker, for example, though the NFT can be bought or borrowed from another player. If someone is playing with a delegated NFT, it will not appear in that person’s wallet, but this does not materially affect CoinDesk’s overall analysis. This metric filters out some of the casual users that treat Decentraland like a Web2 product and also eliminates many of the bots.
  • After applying filters via Google Sheets for both of these attributes we got a number back: 810.

A Google Sheet demonstrating all of our work is available to review here.

For Decentraland’s Music Festival we took a slightly different approach. Given that this event also serves as a “sales funnel” for Decentraland, we decided to generate numbers that include those that have and do not have an NFT in their wallet.

  • Atlas Corp. provided us with JSON files in a similar structure to the Oct. 7 snapshot that listed out the wallet ID and time spent across all of the scenes (there was an area called Main Stage and On Site) and the multiple dates.
  • We applied the same Python script to sort them into an Excel sheet and then to Google sheets. From there we used the same time filters to eliminate those that spent over 25 minutes and those that did/did not have an NFT. This time range was still a reasonable metric as most of the sets were 20-30 minutes long.
  • Our data shows that there were 3,668 users at the festival who also had an NFT.
  • The data shows that there were 6,080 users in total when the NFT filter was not applied. This larger number is expected given the high profile of the event.

Nansen and Catalyst Nodes Monitor

The other two tools that we used to determine the number of active users on Decentraland are Nansen and Catalyst Nodes Monitor.

Nansen’s Entity Billboard tool attempts to track the number of active users on individual platforms, everything from Uniswap to LooksRare, by looking at the activity on their respective smart contracts. Nansen stresses that this tool is very much in beta. In total, it tracks 3553 smart contracts across Ethereum and Polygon.

During our snapshot period, Nansen reported that there were 526 users on Decentraland on Oct. 7.

While some of the same criticism for DappRadar’s numbers could be applied, the fact that it seems to align with the number from Atlas Corp. would suggest that DappRadar’s numbers are more accurate than its critics suggest. After all, the key to finding out any number is the process of triangulation.

On the other hand, Catalyst Nodes Monitor takes a slightly different approach. It tracks the load on each of its servers which it calls catalysts. Atlas Corp.’s Aisenberg did provide some criticism of this method as there are nodes that remain untracked by the platform, so the real figure is possibly higher than captured.

Catalyst Nodes’ numbers show there were 600 users on Decentraland as of Oct 7. This figure comes from a scraped average across the morning, evening, and overnight.

A final note: The fun factor

Throughout this process, we tried hard to look at Decentraland from purely a quantitative, not qualitative, perspective. After all, taste is subjective but numbers don’t lie.

But it’s hard not to think about Decentraland in the qualitative: Is this a good game?

When speaking with Atlas Corp.’s Aisenberg, he likened it to “Westworld.”

“On the most fundamental level, you have people jumping into worlds, and interacting with scenes that are built by other people. They don’t know how it works on a technical level necessarily nor do they care, and they are able to walk around and choose their adventure,” he told CoinDesk in an interview.

In Westworld’s fictional robotic playground, tourists can unleash their beastly and carnal desires to kill or fornicate to their heart’s desire. Reviews of the show equated it to an edition of Grand Theft Auto set in the wild west, with the show exploring hedonism and the horror of virtualized reality.

Though in Decentraland, you can’t do anything like that.

Whereas Grand Theft Auto V built a living simulacrum of Los Angeles and opened it up to online battles and the ability to complete missions with friends (it even has an online economy that’s currently suffering from inflation), Decentraland feels limited. Its activities are limited to walking around, playing poker, perhaps popping into a brand activation and going to an online concert. At the concert, you watch a video with friends in 3D or see a crudely-rendered concert animation that looks like it’s from the Playstation 2 era. We must admit our team enjoyed briefly jumping around together in a virtual winter wonderland, but we’re also unlikely to plan another group activity in Decentraland.

As of September 2021, GTA V has earned its developer $6.4 billion in revenue across 150 million units sold, with yearly expansion pack downloadable content, as players are still obsessed with dishing out wanton violence in its virtual city. Decentraland, at its peak when the token was worth $5.85, had a market cap of nearly $10 billion despite gameplay that most players would find boring. Now, with 93% of its value evaporating, that market cap is closer to $575 million and token with 30 cents.

CoinDesk got a lot of flack from crypto Twitter for reporting on the number of users on Decentraland, but even if after our analysis, you still believe in the highest number of 10,000 daily users, there’s still a long way to go to achieve the kind of mass success of games like GTA or Call of Duty, or mass adoption of online worlds like Roblox and Minecraft.

UPDATE (Jan. 3, 19:48 UTC)An NFT is required to play ICE Poker, but an earlier version of this story did not reflect the ability of NFT owners to delegate their NFTs. Players that have purchased an NFT will have the collectible reflected in their wallet, while players that have NFTs delegated to them from another player will not. However, this does not have a material impact on our count of the number of active users in Decentraland.