Decentralized Apps (Dapps) are a new way of building applications.
Dapps are decentralized applications that run on a peer-to-peer network, such as a blockchain. These are different from current apps we use that are centralized and controlled by a company. Dapps are not controlled by any company or persons.
Some key features of Dapps
- Dapps must be open-sourced that operate on their own with no company or persons controlling them.
- They also use a cryptographic token to help keep the network secured.
- The data and records are all public and available to be seen to everyone.
Current apps that are more centralized do not have to show all of their data publicly and they can make decisions whenever they want because they control the app.
Dapps versus Web Apps
Facebook, Monday.com and Sidekick Ai are examples of web applications. Current web apps have two main elements: front end and back end. The web apps use software stored on centralized servers. The devices and servers all communicate through coding messages with HTTP protocol. So when you go to Monday.com to see your boards, that information is coming from data held on the companies web server.
Dapps might look similar on the front end for users and use the same technology to render pages on the internet. The back end for Dapps is completely different. They communicate with their respective blockchain networks via a “wallet” that serves as a link to the blockchain ecosystem.
The wallet will manage your blockchain address with cryptographic keys that are necessary to identify and authenticate you. So instead of using the HTTP protocol to communicate with blockchains, Dapp wallets will trigger smart contracts that work with blockchains to execute transactions. The distributed network of nodes will validate and confirm the Dapp data.
What are the benefits?
This allows other developers to build better Dapps in the ecosystem. They are encouraged to innovate, build more function and add utility.
There is no downtime because if some of the computers or users go down, other devices in the network will help keep it running.
It is almost impossible for governments or individuals to control the network, hence they cannot censor the dapp.
But what about the downsides?
Dapps are very promising but there are always negatives and downsides with everything.
- Dapps need a lot of users to make them more secure and more interactive, this is the “network effect”. Lack of adoption from users is a large downside for a Dapp.
- Most Dapps have pretty bad user experience which can turn people away. However these seem to be getting better overtime. Just think about the first versions of Google or Facebook.
What is the future of Dapps?
Decentralized Apps are in a very early stage still. As you see above the total number of Dapps are steadily increasing but per month are slowing down since 2018. In the last 24 hours since writing this article, 1.96m has been transacted. If we average this per day in all of 2021, that totals just over 700m transactions. In terms of USD volume, the last 24 hours was $137.69m. If we average this in all of 2021 that will equal $50b USD volume.
Another large trend is DeFi (Decentralized Finance) and this is in the infancy stage. Basically DeFi is another market but will be trillions of dollars once adoption happens.
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About Kyros Digital
Kyros Digital is a software development company. Our passion is solving problems with software. We are very open minded, always learning and passionate about this industry. You can meet our team here or see some of the work we’ve done (we are always updating this).
Our founders have 10+ years of experience in the software development industry and are very excited about Dapp Development and the possibilities. We even launched our own SaaS product called Sidekick Ai and plan to build and launch many more.