“dApp” is an abbreviation for “decentralized application.” These applications, which are encompassing an increasingly large variety of software services, have no central authority that manages the users' data, and depend on an algorithmic set of rules, rather than any administrator's intervention, to regulate interactions between users. While each of these services is unique, and several different architectures could be used to build this sort of software, all dApps share a few basic characteristics:
They virtually always use a blockchain to record the application's data or transaction history, rather than relying on a central server. Because of the nature of blockchains, any data recorded is nearly impossible to alter, yet it can be widely disseminated between all of the app's users.
- Algorithms are used to regulate interactions between users. Many dApps rely on voting systems that ensure only the actual users have the power to allocate resources, settle disputes, or even reshape the platform itself.
- Cryptocurrencies are often – but not always – involved with dApps, and many choose to issue their own for internal use. These play a particularly important role with dApps, since they can incentivize certain users to host full copies of the service's blockchain.
- A dApp's code must be open source, and not managed by any single entity. Many dApps' developers continue to serve as an influential presence on the platform, but if they were to exercise any sort of central control then the application would definitionally no longer be decentralized.
- Since they are designed to facilitate interactions between a network of users, dApps must always use the internet.
What Are The Top 4 Advantages Of dApps?
The unusual structure of dApps offers several significant advantages over more traditional server-client software: they are inherently secure, easy to integrate with cryptocurrencies, and can operate entirely free from corporate influence.
Since they typically rely on a blockchain to store any sensitive data, dApps are by their nature able to guard against any intrusion by anyone trying to alter that data to steal money or censor any of the content. This is possible because a blockchain stores information in a way that cannot be changed unless all of its hosts agree that the change is valid, since each entry is incorporated into the hashed value of the subsequent entry.
Seamless Integration With Cryptocurrency
Many dApps involve cryptocurrencies; blockchains, the technology that dApps depend on, were introduced by Bitcoins, and cryptocurrency transactions remain the most widespread deployment of the technology. Using cryptocurrencies can stimulate activity on the platform by rewarding content creators, and incentivize certain users to host a “full node” – a copy of the dApp's entire blockchain that accepts incoming transactions, and possibly verifies them through “mining.”
Many dApps that use cryptocurrencies create an internal token unique to the platform; these are often based on Ethereum and integrated with its blockchain, since that currency's ERC-20 standard makes it very simple to create a unique token.
Resistance To Corporate Intervention
Most traditional applications depend on their developers or some other central authority to facilitate transactions and make decisions about the structure of the platform itself, but dApps operate entirely on their own once set into motion.
This means that they are free from any outside influence, whether it's from the developers, a corporation, or a government. Since each individual user holds a stake in the management of the data and platform, infiltrating it would require manipulating enough of them to create a majority; there are no documented examples of this.
Novelty And Potential For Innovation
The full potential of dApps has certainly not yet been realized; while these applications' inherent freedom from outside intervention has made dApps increasingly popular with many of the same libertarians who first championed cryptocurrencies, they have also been used to create applications that don’t necessarily require privacy or security, such games and networks to share entertainment content. As software developers become increasingly interested in dApps, it will be fascinating to see how the technology continues to grow.