MM is based off of your elo. The smurfs will end up playing each other after a while. I have a "smurf" but that smurf is morely just to have a 2nd level 30 character. 1 that I can play with my friends on and the other that I can do serious ranked matches. Right now I've been doing ranked with my friends on my main account.
What I noticed while leveling my "smurf" is that after a few easy wins the MM system will either match you against people way higher level then your or other smurfs.