I've got some people who are rather confused at the story I have so far so let me clear some things up.

Characters:
Drew (the guy with the green and brown shirt who appears in every animation)
Much of his character remains a mystery on purpose. I have an original series planned that is about the "origins" of his "powers" and whatever else is mysterious about him. He has a laptop and a few miscellaneous objects with him, but what he does with them is not important. He is not the star of this series, even though he seems to be. I reveal exactly what I want to reveal about him.

LyDia (the blue-haired girl who tags along with Drew and fights every round)
I've said before that she is an undeveloped character. That is what she is even in the story, which explains her "leveling up" in every round and why she has no voice. Her specialty is magic circles:
Red = Offensive type
Blue = Defensive type
Green = Portals
White = Healing type
There are more that may be added in each episode.

Libra (First round opponent; oranged-haired British guy)
More about him found here.

Raenn (Second round opponent; grey-haired, half dragonkin/half elvish girl.
More about her found here.

Sarah (dark haired elvish girl with armor(?))
She was Raenn's opponent in Round 1 but she lost without a fight. She decided to accompany Raenn for the rest of her time in the tournament.
There's not much more to her than that. The creator hasn't put a character description anywhere I could see.

Obviously Libra, Raenn, and Sarah are not my characters so I can't provide in-depth detail and backstories of them.

Story
"A Gentleman arrives to a world, a floating isle which city is desert he waits until night in hope of finding someone or something, At the night, he finds in the highest building/tower of the city a Light, so he decides to go to there...
At the last floor of the Building a beautiful lady sits over the floor an empty room looking at the shadows of what used to be her home place though the glass walls of the last floor
-"Hello Madam" The gentleman said
She surprised and looked at him, wondering who he was, and what he was doing there... so she asked and the Gentleman replied "I'm a worlds traveler,I go from world to world looking for adventures, but this place looks quite desertic and dead"
The Spirit then looked back to the city and replied "Demons corrupted the hearts of its people, They started to kill between them until all of them where gone... I'm the only one left, but I have nowhere to go, nothing to do"
A moment of silence took place and then the girl continued
"I was the guardian spirit of this city, But without a city to protect, I have nothing to do anymore, I could use my power to grant you a wish"
"A wish?!" Asked surprised the Gentleman, then continued "Can it be anything?, Money?, Power?, Eternal Life? Recover a lost being?..."
"I Think I can use all my power and existence to try to accomplish that wish... most of what you asked would be easy to me though..."
But the Gentleman had no wish at all, something that disappointed the spirit... her existence wasn't looking like coming to an end
"Don't be sad, I'll help you to find an appropriate person to use your power, That might be resolved with a Tournament my dear friend" Replied The Gentleman, then he wrote something in some papers he had with him, he put a weird seal in all of them, trowed them though the windows and one by one those papers started to flash and then disappear.
The spirit looked intrigued for see what does the Gentleman just did
He sent invitations to different worlds near an appropriate candidate or someone who knows a friend who would need that wish, the paper would open a portal that would send people to the empty city, to give it it's last party..."

The host also wrote a journal entry about the Tournament itself which includes the above story.
Then he wrote a journal entry for Round 1 about who's battling who and everyone's entries. The one for Round 2 is the same.

You can read the host's entire story right here, which includes the introduction as a comic, his version of Rounds 1 and 2, and some extra stuff.

I know there's a lot to look at but at least its there. Don't complain to me about something I've already explained here.

If you have any questions or if there are any unanswered above, comment here and I will try to update it as much as I can.

And now here's a picture of Drew and LyDia :3