Decentralised Apps (dApps): Basic Explanation for Crypto Beginners
Decentralised applications — also known as (dApps, dapps, DApps, dApps) — are digital applications supported by a distributed ledger technology (DLT) that run on a blockchain or peer-to-peer (P2P) network of computers instead of relying on a single computer.
Smart contracts are used by DApps to carry out transactions between two anonymous individuals without the requirement for a centralised authority. Users of dApps could need to pay a developer some cryptocurrency to download and utilise the source code for their programs.
A centralised app, on the other hand, is owned by a single company, and its application software is located on one or more servers that are under its control. Twitter, Facebook, Instagram, Netflix, Banks and other financial institutions use centralized apps to allow their customers online access to their accounts.
A developer can build a blockchain-based alternative to the well-known Dapp social networking platforms, allowing any user to publish messages. Once posted, no one — including the app creators can delete the messages.
Peepeth, a social network alternative to Twitter, is an example of a dapp. Cryptokitties is a dApp game that allows users to buy and sell virtual cats. Chainlink is middleware software that provides tamper-proof inputs, outputs and computations for Oracle networks. MakerDAO is a decentralised credit service supporting the stablecoin Dai and allows users to open a collateralized debt position (CDP).
There are three key procedures one must take when creating a DApp:
(i) the publication of the DApp’s whitepaper
(ii) the distribution of initial tokens
(iii) the distribution of ownership
Meanwhile, DApps distribute their tokens through three main mechanisms: mining, fund-raising and development. They are often built on the Ethereum chain and EOS. It can be developed for a variety of purposes including gaming, finance and social media. The first crypto, Bitcoin, is an example of a Dapp.
Benefits of Decentralised Applications (Dapps)
Dapps (decentralised applications) are growing in popularity due to their many benefits. As the benefits of dapps become more well-known, we expect to see more and more businesses and organisations adopting this new technology.
There are many benefits of building dapps, such as increased security, transparency, and immutability. Here are some of its advantages:
(i) They are free from the control and interference of a single authority.
(ii) Users do not need to submit their personal information to use the function the app provides.
(iii) They are also often cheaper and faster to develop than traditional apps.
(iv) Dapps can also be built on top of existing blockchain platforms, which makes them even easier to develop and deploy.
(v) They are powered by blockchain technology, which gives them additional security and transparency.
(vi) Dapps are also censorship-resistant. This makes it a powerful tool for developers who want to create applications that are resistant to censorship and fraud.
Limitations of Decentralised Applications (Dapps)
(i) There is a potential inability for Dapps to scale
(ii) It is often challenging for developers to build a user-friendly interface
(iii) It is difficult to make code modifications on DApps
(iv) They are difficult to maintain, debug and update, as all fixes require the consensus of all the peers in the blockchain-based network
(v) Some Dapps require a high monetary budget
Overall, dapps offer several advantages over traditional apps. They are more secure, more transparent, and more resistant to censorship. If you are looking to build a decentralised application, dapps are the way to go.
Disclaimer: The opinions expressed in this blog are solely those of the writer and not of this platform.