InstaForex

September 30, 2021

What Are Decentralized Applications (DApps)?

 Intraday readers should be aware that in most of the crypto articles uploaded, there is definitely the word ‘dApps’ or decentralized applications.


Do you know what dApps is?


dApps or decentralized applications refer to digital applications or programs that exist as open source on a blockchain or peer-to-peer (P2P) network.


 It combines smart contracts with a frontend user interface.


Just like a traditional application that operates on a single network only it is not controlled by any entity because it is decentralized.


dApp opens space for users to make any changes to the software using a consensus mechanism.


Imagine like Wikipedia where the contributors of information in it can change the content either in whole or in part only.



Benefits of dApps:


The network becomes immune from the control of the authorities or the government.

There is no limited period within which a P2P system ensures that dApps continue to operate.

As long as the blockchain is developed by smart contracts, it can integrate cryptocurrencies within the basic functionality of dApp.

Disadvantages of dApps:


Since it deals with open source smart contracts, it is relatively easy to hack.

Most dApps have a poor user interface causing users to dislike it.

dApps depend on the number of users which the higher its usage, the more effective it works. It is called the 'network effect'.

At the time of this writing, a total of 2614 dApps have been developed on various networks including Ethereum, EOS, Tron, and NEO. But most dApps are of course developed on Ethereum because this network from the very beginning provided smart contract support.


The most popular types of dApps right now are decentralized crypto exchanges (DEX) such as Uniswap, SushiSwap, and DODO, as well as video games: Axie Infinity.


Dapps can be considered to be in the early phases of its development. Perhaps in the future, it will be able to lead the technology that is currently the choice of most application developers.