How To Buy Decentraland Online in 2022
Start trading now with eToro
Decentraland is a web 3 video game, meaning that users can own in-game assets. You can use the Decentraland native coin, MANA, to buy virtual land and items in the Decentraland virtual reality. MANA is one of a few metaverse cryptocurrencies that have blown up in 2021 along with SAND, and some virtual real estate plots in MANA have sold for millions of dollars. Read more to find out why MANA may be a great investment for 2022.
Best Brokers to Buy Decentraland in 2022
Here are a few of the best exchanges where you can buy MANA right now:
Decentraland has been the source of much media attention lately, as individuals spend thousands and millions of dollars to purchase in-game assets.
The price of the coin is quite high relative to the price of the average in-game item when compared with other video game item costs. This could be a challenge to its future growth.
The Decentraland Coin, symbol MANA, is likely to hold some value into the future as past user spending creates stickiness for the platform.
There are other Metaverse tokens you can spend in virtual worlds, such as SAND, which you use in Sandbox and may compete with Decentraland in the future, especially as companies try to jump on the metaverse and web 3 hype.
There are mixed market signals and buyers should consider watching the coin, but there are better coins to invest in.
What Is the Difference Between Owning a Coin VS a Derivative Product?
Derivative products allow traders to make money on the change in the price of an underlying asset without taking ownership of the asset itself. For example, on UK broker sites you can buy contracts for difference or spread bets. If you buy a crypto CFD you don’t actually own the crypto, just a contract with the broker. CFDs have no specified end date and can be sold to other individuals peer to peer. Spread bets have specified end dates and specified payouts depending on what happens to the price during the term. These kinds of derivatives are even more speculative than owning crypto, and more than two-thirds of crypto CFD traders lose money.
If you buy cryptocurrency on an exchange, you own it. In this case, you have to sell the crypto to realize profits, or you can hold it indefinitely. Crypto can be traded for other cryptos that have a trading pair for the coin on exchanges where the crypto is listed. You can hold crypto securely in an encrypted wallet, whereas you only own a contract with a broker if you purchase a derivative, and the derivative is only as secure as the broker is trustworthy. Many altcoins do not have derivatives based on their value. You can buy MANA CFDs on Capital.com.
Different Ways to Buy Decentraland
Because Decentraland is still a relatively nascent altcoin, it isn’t available on as many platforms as a large-cap coin like Bitcoin. Still, there are a few options.
Decentralized Exchanges: DEX’s are for more advanced traders who already have some cryptocurrency that they want to trade for MANA.
Buy directly from the Decentraland Marketplace with Ethereum if you have a compatible wallet and hold ETH.
MANA is not yet listed on payment platforms like Paypal, and you can’t buy MANA directly from crypto ATMs.
How to Buy Decentraland Online
Here is a step by step guide for beginners to start buying MANA on a centralized exchange:
Step 1: Pick a centralized exchange that lists MANA
Step 2: Download the mobile app and set up your account
Step 3: Verify your identity
Step 4: Link a bank account
Step 5: Make a purchase
How to Trade Decentraland
Centralized exchanges, also called crypto brokers, are easier for beginner traders because you don’t have to set up a wallet or understand complicated technical specifics. Decentralized exchanges require a wallet and some esoteric knowledge of crypto to use.
Trading on a centralized exchange is similar to purchasing crypto, but you use crypto to make purchases not fiat currency. Once you have an account and have made your first purchase, if you want to trade one coin for another you should:
Step 1: Determine what coin you want to trade for
Step 2: Find an intermediary coin with a trading pair
Step 3: Make the trade to the intermediary coin
Step 4: Make the trade to the coin you desire
It is better to trade crypto than to sell for fiat currency if your country taxes crypto capital gains. As long as you keep holding your account value in crypto you defer realizing gains and don’t have to pay taxes.
Crypto Investment Strategy
Having a strategy that you will stick to is important, especially for beginner traders to avoid emotional decision-making like impulse buying at an all-time high price and then selling at a loss. Here are two basic strategies:
Also known as HODLing (holding on for dear life). If you don’t want to watch the market all the time, invest in coins you believe in, and plan to hold them for at least a few years. If you had bought $1000 of Bitcoin 10 years ago you would be a multimillionaire.
This is traditionally considered “day-trading”. If you want to try to beat the market, buy a coin at a low price, and sell it when it goes up, taking profits. Chartists watch graphs and look to buy assets around their “support” price (where it previously bottomed) and sell at their “resistance” (where the price previously peaked).
Regardless of your strategy, don’t buy based on fear of missing out, and don’t sell at a loss.
How to Store Decentraland
In the past, some exchanges have been hacked, and investors' crypto was stolen. Because crypto is trustless and one way, there was no way to recall the funds. For security, hold your crypto in a wallet.
There are “hot” wallets and “cold” wallets. Hot wallets are connected to the internet and are apps you can download on your phone. While more secure than leaving your crypto on an exchange, because hot wallets are connected to the internet, they can be attacked. In a few cases, individuals lost millions of dollars.
Cold wallets are also known as hardware wallets. When you unplug a cold wallet from your PC, there is no way a hacker can gain access to your crypto holdings. However, if you lose your cold wallet, you won’t be able to recover the crypto.
Here are a few of the best wallets where you can store your Decentraland Coin.
Ledger Nano S
What Are the Different Ways to Pay for Decentraland?
If you purchase MANA on a broker site, you can pay with any payment methods they accept. Binance accepts 62 payment methods at this time including:
Linked bank account transfer:
The cheapest for US and EU citizens. ACH and SEPA transfers are free. SWIFT may incur 3-4% commission for other nationalities.
For a convenience fee of 3-4%
Can affect your credit usage and negatively impact your credit score.
Sometimes puts holds against large transactions
What to Consider When Buying Decentraland
If your strategy is to trade with short-term holds, trading fees add up quickly. Make sure to pick a platform with very low trading fees like Binance.
Before setting up an account and funding it, research the security and reputation of the exchange. While your crypto may be safe in a wallet, your ID and sensitive bank information will be stored on the exchange.
Crypto in general is volatile. After long periods of price increases, it is likely there will be a pullback. Dollar-cost averaging will reduce the exposure to this kind of swing. Buy small amounts of crypto at regular intervals and hold long-term if you are unsure where to start.
Regulation on crypto is still murky. In the US the SEC and DOJ are haphazard in their application of rules, targeting some cryptocurrencies and crypto exchanges while letting others slide. US administrations have been talking about “cracking down” on crypto which could weigh on all coins.
Length of hold and trading strategy:
Always trade with a strategy and stick to it unemotionally. If you can’t hold a position long-term, it is better not to invest. If the value drops you may have to hold your position for a very long time before you can take profits.
Deflationary vs inflationary supply:
MANA in particular is interesting because the supply was once inflationary, then stable, and is now deflationary. Every time MANA is used for a transaction 2.5% of the transaction is burned. A decreasing supply indicates a long-term price increase, all other things equal.
Competing coins and projects:
MANA is not the only metaverse coin. SAND, used for the Sandbox virtual reality, also made huge gains this year. As more games enter the market with NFT and crypto functionality, they could steal market share, causing the value of MANA to decrease. The limited use case of MANA for its singular virtual reality is its greatest weakness.
Is It Safe to Buy Decentraland Online?
Make sure to research any exchange before you sign up. Look for basic security measures like two-factor authorization and a clean history. The larger the user base and the older the platform, generally the better.
Be wary of anybody reaching out to you about investing in cryptocurrency. There have been a number of crypto scams involving social media platforms, including Instagram ads and YouTube advertisements. Never transfer anybody crypto for any reason unless you are on a trusted marketplace like the Decentraland official marketplace or a p2p platform with a long history.
How to Sell Decentraland
Selling on an exchange is very similar to buying except you will select “sell” and execute the trade for fiat currency. If you are going to keep trading crypto it is always better to sell your crypto for a stablecoin.
If you hold your crypto on a wallet you will first have to transfer it back to a centralized exchange account, and then you can execute the sale. It is possible to sell your MANA and other cryptos to private buyers for cash. You should transfer from your wallet to theirs. Make sure the wallet address is correct, if not the crypto will be lost forever.
Is It Worth Buying Decentraland Right Now?
Nobody can tell you with certainty what will happen to any coin, but at the current price near $4 a coin, probably not. The market indicators are mixed and price predictions from most commentators are split down the middle. If Decentraland can attract a much larger user base who are willing to buy, hold, and transact the coin to play, MANA will appreciate in value proportionately. But that seems doubtful considering that most plots of land are selling for thousands of MANA, and even the cheapest in-game items are a few MANA. Such high prices are likely to turn off younger players, who make up a large portion of the overall video game market.
While it may be possible to hold MANA for a very long time and profit off of the deflation of the supply of the coin, there are so many other options of crypto with more positive indicators. While it is unlikely that Decentraland will go anywhere, and the core user group will continue to play even if the coin depreciates, it is very likely that the coin itself is only valued so high off the current media attention and hype around the metaverse. The explosion in SAND’s and MANA’s values will inspire many entrants, and new games with more interesting capabilities and more engaging features could steal the limelight. We will likely see the total value of all metaverse tokens grow immeasurably in the future, but it is hard to say which will be the leaders even a few months from now.
Decentraland is a very exciting proof of concept for the metaverse. The explosion in the market cap of MANA proves that cryptocurrency can drive immense value in web 3.0 as users start buying digital assets. At the moment MANA is valued very highly, and there are other opportunities to invest. Look for coins with longer trading history and stronger fundamentals like applications outside of a single video game. Keep watching this coin. There could be opportunities if there is a break in price, and MANA is likely to stick around.