Understanding DApp’s : Decentralized Applications

We have seen how Internet applications have impacted our life by providing comfort to buy, sell, send , receive anything we want to, in the blink of any eye. These all Popular Apps like FB, WhatsApp, Twitter, Instagram in-fact majority of them falls in the category of Centralized Applications. Why all these are called centralized app is because the back-end server which holds the data belongs to one single authority/entity who own these apps and its data privately . Centralized applications have been in existence for a long time, it has certain limitations and issues of its own like

  • Less transparent
  • Hackable
  • Single Point Of Failure
  • It Can’t Handle Internet Censorship

It is because of some of these problems a new wave of Decentralized Applications Called DApps has come into existence .

Lets try to understand more about DApps:

What Are DApps?

DApps are distributed internet apps which runs on decentralized P2P network and whose code base is publicly open for others as an open source to be accessed and customized. DApp is not owned by any single node in the network. Peers in the network can be any single computer which is connected to the internet.

Distributed Apps:

Distributed applications are spread across multiple server instead of lying on any centralized single server. It helps to manage huge data and traffic demand to prevent the application downtime for critical projects which can’t afford to be down. In this mechanism, data of an app has multiple copies across multiple network nodes.

Centralized Apps is not necessarily distributed in nature, but for DApps, the apps are always distributed.

For any App to be qualified as DApp Specially in the context of Blockchain has to fulfill following criteria:

1. Application must be completely open-source

DApps is not controlled by any organization or an entity, it must operate autonomously where no single node controls the majority of its token. Any changes in the DApp is exercised using Consensus protocols decided by the participant users.

2. Application’s Data Should Be Stored Cryptographically and Accesible Publicly

The Applications must cryptographically store its data and operation records as a decentralized public blockchain.

3. DApps Must Use Cryptography Tokens As An Asset:

To access DApp distributed app, user should use token(Asset) also to someone who is contributing to build consensus within the nodes of the P2P network as miners needs to be rewarded with the secured tokens which is encrypted cryptographically.

4. Apps Must Generate Tokens:

Why DApps? Advantages:

As we have discussed in the starting we have certain advantages of this decentralized technology, which cover up few loopholes in the current Centralized app ecosystem .

So lets see few bullet pointers to understand DApps Advantages:

1. It Is Fault Tolerant -

As there is no single node controlling the data transaction and data records in the P2P decentralized network, there is no single point of failures in DApps. Its distributed nature supports this very strongly.

2. No Internet Censorship

It Controls and prevents Internet Censorship violation as there is no central controlling authority owning this DApps network. So if someone tries to manipulate with data sets in their favor it is practically not possible. Any government authority if tries to block any DApps, it will be not be possible as app doesn’t lie on any particular I.P address being decentralized in nature.

3. Enhanced Trust On The System:

As no single entity own the apps it helps user to have confidence and trust on the DApps system against the data theft and manipulation.

Why You Should Be Bothered? Disadvantages:

As there are two sides of every system so is the case with DApps one hand it has lots of security, trust to offer it has some disadvantages too, like-

1. Any Updation And Bug Fixes Are Difficult:

It is nor easy to fix any issues in DApps as every peer in the network has to update the fixes across all the copies in the network which can be a daunting task.

2. KYC Is Diffcult:

A lot of modern day centralized apps rely on user verification, which is quote easy given the single authority is controlling and verifying it. But with DApps as there is no one single entity responsible to do KYC verification, it is quite a challenge to build this type of apps in DApps.

3. Complex To Develop Scale

As there are complex networks and protocols to be implemented in DApps in- order to achieve consensus for data validation , the entire Apps needs to be planned and build considering the scale from the very beginning. It is not the case with Centralized Apps where you can build MVP and later on scale the system based on need.

4. Not Enough Evolved Third Party DApps:

As we rely many times on third party API to fetch certain their party information in the current Centralized App mechanism, you don’t have this leverage with DApps as currently there is no such large third party DApps ecosystem in place. As DApps are supposed to interact with another DApps for their API needs it is quite a lag which will improve over the period of time. DApps are not supposed to access API through any centralized Applications which is not the reality in current market dynamics.

Some Of The Popular DApps Example:

Bitcoin:

A decentralized currency known among traders, it is one of the very first DApp which gained mass popularity and written a successful script to validate the power of DApps. Bitcoin is the first DApp to use blockchain technology to records transaction & data.

I have covered Blockchain many times in my previous articles, but let us understand in short what blockchain is actually.

Blockchain is a data structure which is used to create decentralized ledgers to hold transactions/data. The blocks in the blockchain contains

  • A set of transaction records
  • Hash of previous block added in the Chain.
  • Timestamp
  • Block rewards
  • Block Number and so on..

To know more about Bitcoin please refer this article of mine:

2. Ethereum:

Ethereum Is one another supreme example of the platforms which runs DApps on top of it. Here the DApps uses smart contracts. One or ore Smart Contracts can create a DApp together.

Smart contracts are executed as it is programmed without any deviation and ensures no downtime, no censorship, no fraud and with no third party intervention.

There are many more popular DApps, like

- Hyperledger Project:

Which is used to develop Permissoned DApps.

- IPFS:

Interplanetary File System : A decentralized file system which uses DAH(distributed hash table) & DAG(directed acyclic graph) data structures.

- Ripple : A Decentralized Remittance Platform

& many more.. We will get into the details in our next articles On DApps in the series.

Summary:

Every new technology is supposed to bring some innovation and impact to this digital economy , which all these DApps, and the Blokchain powered innovations are invested upon. We are witnessing a great technology shift which once adopted globally will give rise to many new opportunities for the ones who are already working full throttle to get acquainted to it. For general public this decentralized technology will transform their life by offering transparent, secure and trusted ecosystem where they can also participate to make their meaningful contribution and also earn out of it.

This Blockchain powered technology will be like a Decentralized democracy where everyone will have a say, making an impact on this global economy on a larger scale.

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