How does Free Play work?

Hi guys

In the recent patch they implemented a free play mode where you play games with mostly competitive settings, but no elo lost or gained.

So how does it match you with opponents? Is it by your regular RM Elo? Or just whoever seems to be nearby?

First couple matches I played were obvious beginners. But then next couple games were all my level. I talked to one of the guys I played with in game and we exchanged RM elos. His elo was close to mine.

So is it based on RM elo? Or whoever is nearby? Or is there an Unraked elo or something.