dApps: It’s been 5 years since… Where are they headed now?

It’s almost about to be five years since the emergence of the concept of the dApp or decentralised applications. dApps were envisioned to mainly serve as open-sourced applications that adhered to a set of protocols and their records would be available on a publicly verifiable blockchain. During my time at Microsoft, we took a platform-agnostic approach to blockchain, by creating developer tools that would make building blockchain applications easy.

This was, of course, in anticipation of an explosion of dApps that would see existing centralised applications disrupted. Back in 2017, we would often hear companies setting out to create a decentralised Über or AirBnB. To be honest, many of them built it too, and they raised large sums of money to make this a reality. But here we are, two years on, looking at over 1000 dApps that were built, with next to nothing for usage, in the larger scheme of things.

A hammer looking for a nail?

I think the fundamental premise of dApps needs to be questioned. Does everything need to be a dApp? Do we need to decentralise Über and AirBnB? Are the inefficiencies of these centralised applications solvable by the blockchain? Does it need a blockchain? I think that is the question a lot of the dApp builders in 2017 and early 2018 didn’t seriously ask themselves. And that’s reflected in dApp usage and adoption today.

If you were to look for a non-exchange dApp on dAppRadar today, you would find a handful of dApps across all mainnet protocols with over a 1000 daily active users. And that truly is the measure of success of any application; how many users utilise your application on a daily basis? Most of these dApps are either verification platforms, Financial apps (lending platforms, payment solutions etc) or games.

Going by usage, I think it is safe to say that most dApps today, are solving problems that aren’t really there. Now, don’t get me wrong — in a censorship-and-surveillance-heavy world, dApps do provide a promising solution. But for the most part, dApps today have the reputation of being a black hole for VC and crypto money with poor user experiences and thereby users to show for.

dApps are a work-in-progress

If the previous section came across as too critical of dApps, that was the point. Today’s blockchain and crypto elite are dismissive of dApps and it’s almost cool to be critical of it. Blockchain layer 1 and layer 2 solutions are all the rage now, as they’re solving the fundamental problem of speed and scale. But let’s not forget one thing — the mass adoption of blockchain technologies will only happen through dApps.

dApps are a work in progress. They’re definitely not ready for now and they won’t be, for the most part, in the coming years either. To put that in perspective, there is a growing population across the world that wants decentralised money, and it’s taken Bitcoin over 10 years to achieve that demand. I don’t see this being any different for dApps.

But that doesn’t mean we write off dApps for now.

The emergence of the hybrid dApp

While we wait for fully decentralised applications to become mainstream, there are hybrid dApps there are emerging. To be honest, most enterprise dApps are hybrid dApps. These dApps keep some of their records on an immutable ledger, and their source code is mostly closed. But enterprises are using these dApps quite regularly — some popular ones include the Maersk and IBM bills of lading dApp.

As we at Eleven01 build our dApp ecosystem, we’re seeing some of these hybrid dApps come into the public realm as well. Take for example one of the dApps built on the Eleven01 Protocol — DocsinBlocks. This Eleven01 dApp stores certificate data on the Eleven01 blockchain, but otherwise runs like a regular app. Same with ICRISAT’s KHETHINEXT dApp — price data and farmer ownership data are on the Eleven01 blockchain, while the functional components work as a regular app.

Increasingly, we’re seeing regular applications using blockchains to make certain parts of their applications more transparent, immutable and secure.

I think the evolution of dApps has arrived at a viable interim, and as the journey in the pursuit of complete and autonomous decentralisation continues, we will see blockchains used tactically in these hybrid dApps.

This will go a long way in mass adoption for blockchain over the next few years.

Build a dApp on Eleven01 here.