Use Decentralized Apps

What are decentralized applications (DApps)

Decentralized apps (DApps) are digital apps or programs based on smart contracts that run on a blockchain rather than on centralized servers. They look and function like regular mobile apps and offer a wide range of services and functions, from games to finance, social networking and more.

As the name implies, DApps operate in decentralized peer-to-peer networks. An early report determined that DApps should have the following characteristics:

Open Source: DApp source code is in the public domain and any user can check, use, copy and modify it. Most coins or tokens cannot be controlled by one particular entity. Users can propose and vote on changes to the DApp.

Decentralized and cryptographic security: to ensure data security, all DApp information is cryptographically protected and stored on a public decentralized blockchain maintained by multiple users (or nodes).

Tokenized system: DApps can be accessed using a cryptographic token. They support cryptocurrencies such as ETH and can generate a native token using a consensus algorithm such as Proof of Work (PoW) or Proof of Stake (PoS). The token can also be used to reward miners and stakers.

Thus, the Bitcoin blockchain can be called the first DApp. It is open source, stores data on a decentralized blockchain and uses a cryptocurrency token and the PoW consensus algorithm. The same applies to other blockchains with the above characteristics.

Now, however, the term “DApp” generally refers to all applications with smart contract features that run on blockchain networks. Since Bitcoin does not support smart contracts, most users do not consider it a DApp.

As of June 2022, most DApp applications run on the Ethereum network – it offers a robust infrastructure for expanding uses. But as DApps have evolved, developers have started building them on other blockchains, including BNB Smart Chain (BSC), Solana (SOL), Polygon (MATIC), Avalanche (AVAX), EOS and others.

How DApps work

DApps are applications based on smart contracts. Their internal code works in distributed peer-to-peer networks. A smart contract is a set of operations performed by computer code. If certain conditions are met, network nodes perform the tasks specified in the contract.

Once smart contracts are deployed on the blockchain, it is very difficult to change or destroy their code. Therefore, even if the DApp development team is disbanded, users will still be able to access the application.

Benefits of a DApp

While the interfaces of DApps and centralized applications may look similar, DApps offer more advantages. Traditional web applications store data on centralized servers. Breaking into one of these can take the entire application network offline for a while or permanently. Centralized systems can also suffer from data leakage or theft, putting companies and users at risk.

DApps, on the other hand, are based on distributed networks without central management. Because of this, they have no single point of failure, making them less vulnerable to attack by attackers. A P2P network can also keep a DApp running continuously with minimal downtime, even if individual computers or parts of the network fail.

The decentralized nature of a DApp also means that users have more control over information. Since no companies control users’ personal information, they don’t need to reveal their identity to work with the DApp. They can connect to the DApp with a cryptocurrency wallet and have complete control over the transfer of information.

Another advantage of the DApp is that with smart contracts, developers can easily integrate cryptocurrencies into the core functions of the application. For example, DApps on Ethereum can accept ETH as payment without integrating third-party services.