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Totems of undying have been around since the world split, they have been giving a second chance to players since one world turned into multiple servers, maybe even before that.
Maybe that's why their magic effects those who don't have one yet, they allow those who have died to wake up in their bed with only memories and scars. They rebuild the body they once had and give them another chance to live, over and over again.
But when their magic stops working on them it lets them move on to be reborn or to leave the world of the living and go to an afterlife.
Nothing can reach to far though. When the split happened Totems didn't manage to reach some worlds, in those worlds you only have one life and no second chances to live it.
Some worlds they do exist but don't give their magic to those who haven't got one. Their magic is weakened in those world, they can't help the players that are so far away. The players call these hardcore worlds.
There are some world where they can still reach the players, but are weaker and can only save them for a certain amount of times.