The Case of the dApps: Future or Fad?

Decentralised applications are a new wave of applications that use of ‘blockchain’ technology.

Team Luno
· 5 min read

When did you last get a new app on your phone? You probably hit ‘download’, waited for it to load, sped past the ‘I AGREE’ part, and carried on taking pictures of your dog sleeping (because he’s super cute).

It’s almost certain that, as you signed up, you agreed to share personal data (like your location or contacts) with a company you might not know about. Maybe you read the long-winded privacy policy.

Although you probably didn’t.

But it’s hard to miss the ongoing debate surrounding online data collection and the way many companies mislead us or abuse our trust. Much of the discussion pins the blame on users for not understanding the deliberately misleading terms they accept, or for continuing to use services that exploit their data.

What if there’s another option, a way of using the services that have become a valuable part of our lives while preserving our privacy and control over our personal information? That option already exists, albeit at an early stage.

Decentralised applications — or dApps — are a new type of application that makes use of blockchain technology.

What is a dApp?

A dApp exists as a decentralised network run by users, with no central control or single point of failure.

This means that when you use one, you’re not handing data over to a company which could abuse it. The whole thing works autonomously once it’s launched. Users vote on any changes to the software using a consensus mechanism. They provide the computing power necessary to keep the network running and receive tokens native to that platform as compensation.

Although Ethereum is often mistakenly described as a cryptocurrency, it’s actually a platform for building dApps (among other things), with a native token called Ether.

In the same way that it can be hard to envision the implications of a decentralised currency, dApps represent a whole new vision of the internet completely unlike its current iteration.

The advantages of dApps

As dApps have no single point of failure, they’re more resistant to attacks than applications which typically have a single server. If a single-server app falls prey to an attack or goes down for any reason, the entire system stops working. A dApp will only fail if every computer in the network fails, which is usually close to impossible. If one fails, it won’t pose a problem.

The other advantage of dApps is that they’re resistant to modification or censorship. Once you add information to a blockchain, it’s permanently stored. Since there is less authority owning a dApp’s network, any external authority that tries to block a dApp will be much more difficult because the application doesn’t lie on any particular IP address.

Centralised organisations are solely incentivised to do whatever benefits them the most, even if it harms their users. Major tech companies continue to disrespect user privacy because it’s in their interest to do so, but it’s unlikely members of a dApp network would vote on harmful decisions.

How do we know a dApp doesn’t have a secret agenda?

Because the code should all be open source, which means anyone can look at it and verify the makers’ claims. New privacy laws are changing in some parts of the world but centralised apps still rely on us asking them to supply us with our data. As dApps function on a public blockchain, the information can’t be hidden.

If dApps are so amazing, why aren’t we all using them?

There are many promising dApps out there, some of which are fully operational and are working on growing their user base.

States of the dApps lists numerous ongoing projects:

The problem is that they don’t function in exactly the same way as the apps we’re used to, and don’t always have the best user experience. For example, as dApps are blockchain-based, you use a public and private key to log into them, not a username and password.

To pay for services, you generally need to use cryptocurrency or a native token, not your local currency. So making and funding an account is more complicated than you might expect. The learning curve doesn’t end there, as dApps can be slow to load and payments take a while to process, adding friction to processes we’ve come to expect to be instant. Users may opt for the devil they know, even if it has hidden fragilities like unscrupulous data collection practices.

Design is also crucial. Not only do we expect apps to work fast, but we also expect certain aesthetic characteristics. For example, if there’s a ‘continue’ and ‘go back’ button on the screen, it’s common for the former to be green and the latter red. If an app switches this around, there is a good chance users will select the wrong option.

We’re creatures of habit and it takes a lot to get us to change. Think about the last time you signed up for a new app, then gave up on it soon after. Did a badly designed interface have anything to do with it? Many dApp makers are more focused on technology than design, which is offputting for users who aren’t experienced with complex interfaces.

For dApps to achieve wider adoption, makers need to think carefully about user experience to ensure they offer seamless, easy to navigate processes. So far, dApps have failed to live up to the early hype, but the technology is still new (most dApps are only, at most, a couple of years old) and these things take time.

As yet, most existing dApps are hybrids of centralised and decentralised technology.

Cryptocurrencies are forming a hybrid economy alongside local currencies, and the same is happening with apps. The looming question still remains, how will these be regulated? It’s clear there is still plenty of work to be done.

Do you think dApps are the future or just a fad? Which projects are you most excited about?

This story is published in The Startup, Medium’s largest entrepreneurship publication followed by +421,678 people.

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Team Luno

Written by

Team Luno

We write about all things crypto. Our articles convey the views of Luno and the many unique opinions and characters within our team. Tweet us @lunomoney

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