Decentralized Applications (DApps) are computer software technology or programs running on the blockchain or on the network of several computers.
The development of DApps is for various purposes, and they are designed to work outside the control of a single individual.
The development of DApps ranges across different areas of our daily activities, including decentralized finance, gaming, social media, etc.
The development of DApps on the blockchain allows it to process and execute transactions through distributed networks. And today, many blockchains, such as Ethereum, BSC, Solana, etc., enable developers to create and have their Dapps running on them.
What does Dapps mean?
A normal web application works and functions on and from a single computer, which an individual controls, but with the invention of DApps, applications are coded and integrated into the blockchain, where every piece of information is open to the public.
The activities can’t be determined and sovereignly controlled by a single person or body but by many connected to the network, and its activities are traced and monitored by everyone.
DApps are run and maintained in an open-source, decentralized environment. When launched on the blockchain, any information created can’t be deleted but could be accessed by anyone connected to the network.
An example is a Facebook-like application. If created and made to function on the blockchain, the information posted by the creator or users can’t be deleted but remains as long as the blockchain exists.
There are different advantages this new technology has offered us, which we will discuss as we continue.
What are the crucial criteria for applications to be decentralized?
For an application to be decentralized, it must possess the following;
Decentralization: This term in cryptocurrency or blockchain refers to a system where the operation’s decision-making, function, and control are determined and run by a collective of participants connected to a distributed network.
Here, a single entity, individual, or organization does not have control over the system, but control is determined by most of its network participants.
The decentralization of DApps gives it the advantage of being off from a single control and manipulation since most participating members have to agree before a change or alteration can be made.
Centralization is prone to fraud and attacks, which can not occur in decentralized technology. Apps decentralization is the new advancement in the world of science and technology.
Open-source: Open-source capability of Dapps enables it to be operated transparently without any secret or hidden data from the public participating in the network.
Incentive: This is a system of reward for miners. An excellent example is bitcoin, where miners are rewarded with new coins created with each new block and a transaction fee for all the transactions included in the block.
Protocol: These are set rules used to establish the structure of blockchain, and these rules allow data to be transmitted and shared between and among computers, thus enabling a safe and secure transaction.
Advantages of Dapps
Privacy: Dapps enable information privacy, unlike our traditional applications running on a single computer, where individual personal and vital information is released to a third party, thus, putting the users at risk. With the development of Dapps, users do not need to give out their personal information to the app developers. Still, smart contracts are used to complete the transaction between the two parties, thus eliminating the need to depend on a central authority.
Data Integrity: Data stored on blockchain are immutable, permanently preserved, and not subject to change. This prohibits a single authority from deciding what remains on the database.
Platform Flexibility: Most popular blockchain platform offers broad flexibility to Dapps development, thus providing an enabling environment in which Dapps can be developed and deployed by developers.
The ability for fault tolerance: Since Dapps are developed and deployed on an open-source blockchain, information can not be easily destroyed if a single node on the network has a break-down period. Computer hackers can’t bring down Dapps since it is connected to several computers.
Smart Contract Integration: With a smart contract for transaction completion, the dependency on a single authority is eliminated.
Decentralized economy participation: Some dapps give away tokens that can be traded to their end users.
Flawless Function; Dapps work 24/7 as it operates continuously on the blockchain. It experiences no break time since the information and codes are saved on several computers. Thus, the downtime of a node does not affect its total disruption and operation.
Disadvantages of Dapps
Maintenance Difficulties: Since Dapps is an early technology, it does experience some difficulties in debugging, updating, and maintenance as it requires the approval of all peers connected to the network.
Code modification limitation: Apps do require daily modification of codes to meet a required task of improvement, bug elimination, and solving some issues, which enables usability and a user-friendly interface, but with Dapps, the code modifications are very challenging and equating to impossible as information on the blockchain is immutable.
Issues with good user experience: Unlike traditional apps, where user experiences are made to suit specific industries, trends, and age, dapps development can’t offer these modifications and changes after deployment, thus, posing some difficulties for better user interaction.
Scalability Issues: Dapps poses significant difficulties in capacity expansion to accommodate growth and many users and concurrently evolving business needs requirements.
What is an example of a Dapp?
Before mentioning Dapp’s examples, here are some examples of popular apps; Facebook, Twitter, Instagram, Pinterest, etc. These are most popular in the world of centralization since a single organization or individual determines its operation. Below are Dapps examples:
Is Bitcoin a Dapp?
What are Dapps? Let’s imagine being paid to browse the web and taking ownership of your information. That world is not far away.
There has been an absolute change in the use of the software after the emergence of Bitcoin and the first open-source application deployed and running on the blockchain.
The emergence of bitcoin gave the world a whole new perspective and a paradigm shift into the world of decentralized applications, known as DApps.
There are numerous definitions of DApp, but there are standard features an application must have to meet the criteria of being a DApp
Important Characteristics of DApps
Open-Source: This term denotes that an application must be transparent and publicly accessed by anyone connected to its network.
These attributes prevent a sovereign body entity or organization from completely controlling its operation and functionality. Its code base should be open discretely.
The traditional applications are close source applications. Thus, most of their operations are determined and controlled by an individual or an entity in charge of their backend, as the end users are only dependent and are limited to their front end.
Bitcoin has this attribute, and thus, it meets one of the significant criteria.
Decentralized Blockchain: All records of the application operation must be stored on a public and decentralized blockchain to encourage transparency, trust, and efficiency.
This ensures that all of its transactions and data used by the application are permanently preserved and immutable.
Anyone connected to the app network can access all this information as they are publicly displayed.
Token Reward: Anyone who helps secure the blockchain application must be rewarded with cryptographic tokens.
A reward system must be implemented for miners contributing to the sustainability and functioning of the dapp blockchain, and this reward is usually in the form of tokens.
These tokens can be traded and easily exchanged into fiat or real currency by anyone who has been rewarded. A DApp must add value to those participating or using it.
Thus, Bitcoin is considered the first DApp since it has all these attributes. It is an implemented blockchain solution that arose around the problem of decentralization.
It allows currency transfer among individuals without validation from a central controlling entity or authority. The elimination of a central controlling authority is what makes an application decentralized.
Why Use DApps
The significant reasons DApps should be used are as follows;
Trust: All codes of DApps are open source. You can see all data and information openly displayed on the blockchain. You can see what the application does and how it does it.
Guaranteed Execution: Desired results are obtained because the code is executed across numerous networks. You get the desired result as long as the node exists, no matter the downtime of any other node in the network. Your network will practically not go offline as long as your code is continuously running on the network.
Censorship Resistance: They don’t have to answer to the government, cooperation, or specific people. Nobody can stop if a smart contract is coded to do something, and it is triggered. This greatly benefits financial applications since nobody can control your money.
They will never go offline: Most of our traditional apps do go offline due to outages, server bugs, maintenance periods, or being shot down by the governments. Dapps can’t go offline since they are run on the blockchain. Having the code run and executed on the blockchain gives the application the impossibility of being brought down through attacks without the total bringing down of every node on the network.
No Intermediary in payment processing: Looking at our fiat currency mode of transaction, a middleman validator must be present before money can be transferred. But not with DApp, as currencies can be moved from one person to another without needing a validator.
Security: User personal information are avoided as they are not needed before the transaction can go through.
Transaction Speed: The speed of transaction and validation of information is high compared to our traditional app, which is not deployed on the blockchain.
How does a Dapp work?
Since Dapps are applications deployed and running on the blockchain, their working structure differs from common applications like Facebook, Instagram, and Twitter.
Dapps use smart contract to control, run and execute the backend logic, though the front end will be coded using normal web programming language like CSS.
Smart contracts are codes running on the blockchain and are made public, granting access without interference and alteration in the code.
Works on the DApps are shared across various nodes connected to the network, thus enabling speed data execution.
Ethereum blockchain, with others, is now available, aiding quick dapp development as they provide a suitable environment and visual aids to dapps developers.
Ethereum blockchain exploded successfully for dapp deployment due to its Quasi-Turning Ethereum Virtual Machine (EVM) technology.
The machine can simulate, deploy and run any computer algorithm speedily in a fast, secure, and efficient way.
Differences between Application and Decentralized Application
Blockchain is a distributed ledger. A ledger is a record of transactions completed by the network. It is called a blockchain because each transaction is represented as a block, and every following transaction depends on the previous block forming a chain.
A blockchain is decentralized because this ledger is not stored in one place, like a typical database server. It is distributed among several nodes, which are responsible for validating the transactions in the chain.
The node is where the blockchain lives, and they have an identical record of every transaction. As such, every piece of information in them is immutable and permanently preserved.
To deploy our application on the blockchain, we need to do the following; first, by developing a blockchain or using a third-party service such as Ethereum blockchain, which enables the development and deployment of decentralized applications called DApps.
The nodes you connect with when you need to interact with the blockchain are called providers. You can read data stored on a blockchain once you are connected to the blockchain through a provider.
To read, write or store data on the blockchain, you need to sign using a crypto wallet private key. And there are several wallets available for use, such as Matamask, Trust wallet, etc. And once a frontend needs a user to sign a transaction, it calls forth the wallet for signature to be done.
How are Dapps built?
Bitcoin decentralization has brought a massive leap in developing decentralized applications called DApps. Dapps are built using blockchain technology.
The use of smart contracts for app interaction is made possible with programming languages such as solidity, serpent and viper. It is the main language for interacting and deploying smart contracts on the blockchain with immense speed and efficiency.
Thus, they have frontend development using major web languages and solidity for smart contract execution, which acts as the backend logic.
Smart contracts automation and self-executing capabilities make an agreeable transaction between two parties to be executed on the blockchain quick, automatic, and seamless.
Most of the DApps are built on the Ethereum blockchain due to the numerous capabilities it offers. Although Bitcoin is known as the first Dapps, Ethereum has played a significant role in dapp ecosystem.
Major platforms for DApp development
The most blockchain ecosystem enabling DApps developments are as follows;
- Ethereum blockchain
- Cardano blockchain
- Tron blockchain
- Solana blockchain
- EOS blockchain
- Klaytn blockchain
- Steem blockchain
- BSC blockchain
Dapp Development Steps
Steps to follow for DApp development are as follows;
- Identify the key problem and the solution you want to provide
- Proof-of-concept creation
- Choose a suitable platform for your development
- Develop the app
- Test the app
What is the future of Dapps?
The importance of DApps cannot be emphasized as they are cutting across numerous spheres of life and business.
Since they are powered by blockchain technology, with no central authority governing them, they never go down nor have a downtime unless the entire world is short off, DApps will be largely utilized by businesses and various sectors for fast transactions, immutable data preservation, and for security purposes.
They will be part of all industries in the nearest future due to their useful and wide range of applications. The application of DApps in finance, gaming, gambling, social media and etc, contract validation in a secure way without the need of a third party has given hope for a better future.
The adoption of DApps in every sector will increase as the knowledge of their use cases increase with time. People will need to understand the blockchain, how it works, and how it can be used for their benefit.
Like in the financial world, most business transactions and contracts become unsuccessful due to fund empanelment and false signatures, but this can’t happen on the blockchain as everything is open and transparent.
Different sectors and individuals will much appreciate the usability and security provided by DApps.
Many business models will be created and most of the existing ones will be taken and decentralized.
The incentivization of blockchain technology will trigger a lot of interest in the heart of many businesses to pull in their resources for a better ecosystem development for DApps in the long run.
Like Play Store and Apple Store holding numerous apps, I believe the Dapps will have a good app store. Crypto wallets are playing an important role as a storage of money, identity and DApps.
This is a unique and interesting development in the decentralization space that blockchain technology has offered.
We are expecting new business models will be created for Dapps mass adoption.
Can you make money from Dapps?
Monetization and incentivization of DApps is really a cool thing these days as many people are learning how to make money developing and using DApps.
DApp developers can charge users for using their service, and users can be rewarded with DApp tokens in return.
Many financial DApps and gaming DApps are becoming the most popular due to this unique attribute they offer.
Most financial DApps allow one to stake their tokens and earn interest within a stipulated time, and gaming dapps allow their users and those who participate in their games to make NFTs, which can be sold at a price.
All these are just the beginning of the good things that are yet to evolve in this space of the blockchain era.
How to earn money with DApps
DApps can make you money in the following ways;
Monetization: Just like normal apps, which monetize their service by providing valuable cases that provide solutions to problems in the market places, DApps can as well be monetized.
DApps developers can work on problem-solving DApps and release them into the market places for the end users to use daily. These services can be made to come with monthly or yearly subscriptions.
All you need to do as a developer is ask yourself what the demand is, which will determine what you can supply to the market.
Incentivization: DApps incentivization has become popular in the past years. In this way, developers would give out some quantities of their tokens to early adopters of their Dapps, called “Airdrop.”
Most Dapps allow staking to earn a more passive income within an agreed time. Earning passively is cool since money in the form of tokens will be given at the end, which can be converted through peer-to-peer services in most exchanges.
The benefits of Dapps today are enormous and mind-blowing.