Decentraland and the Sandbox, the Ethereum blockchain-based metaverse projects, have hit back at reports suggesting low daily user activity on platforms, arguing a “misinformed” metric was used to measure each of the platforms’ daily active users (DAU).
It has been reported that the controversy appears to have come from data originating from DappRadar, with observers suggesting the Decentraland metaverse sees 30 DAU despite having over $1.2 billion in market cap.
“Some websites are tracking only specific smart contract transactions but reporting them as daily active users […] which is inaccurate.”
Arthur Madrid, the CEO of The Sandbox, said:
“On chain transactions does not mean users and that nonfungible token (NFT) owners invest in an asset that will grow in value over time based Utilities.”
However, Decentraland said “better data” can be found at DCL Metrics, a data aggregator custom-built for Decentraland, which measures DAUs by the number of “people who login and then move out of a parcel.” This distinction is significant, as Decentraland’s September data shows 56,700 Monthly Active Users but only 1,074, or 1.89% of those users actually interacted with Decentraland’s smart contracts.
The report said that Sandbox refuted data suggesting its platform has a low number of DAUs, as it has 201,000 Monthly Active Users. But, while this shows blockchain data should never be interpreted without context, it appears as though user experience and engagement are the biggest cause for concern.
Thus, the controversy comes as even the most legitimate metaverse projects face unprecedented pressures in the current bear market — which has caused a steep drop in token prices. Decentraland is currently priced at $0.65, down 88.8% from its all-time high (ATH) of $5.85 with a market cap of $1.43 billion. Sandbox is priced at $0.78, down 90.6% from its ATH of $8.40, with a market cap of $2.36 billion. Both MANA and SAND were down more than 5%, as of October 11.