I don't know. I assume it's similar to how AlphaGo measures its ELO ranking. But the strange thing is, this is hundreds of years of self-play, not a public pool of humans playing against each other. How does MMR in simulation translate to MMR in real matches?
Before pointing out that it's possible for an ELO rating, consider that Dota MMR is a bit different – every game you win, you get +25. Every game you lose, you get -25. This changes at the very high / very low levels, or if the matchups are wildly imbalanced, but that's the general setup. Or it was, a few years ago.
Does anyone have a guess?