Blockchain Cryptocurrency NFT Chapter 11 – What Are Decentralized Applications (dApps)?

Blockchain Cryptocurrency NFT Chapter 11 – What Are Decentralized Applications (dApps)?

Blockchain Cryptocurrency NFT Chapter 11 - What Are Decentralized Applications (dApps)
Blockchain Cryptocurrency NFT Chapter 11 – What Are Decentralized Applications (dApps)

Decentralized applications (dApps) are digital applications or programs that exist and run on a blockchain or peer-to-peer (P2P) network of computers instead of a single computer. DApps (also called “dapps”) are beyond the influence and control of any single authority. DApps – which are often built on the Ethereum platform – can be developed for a variety of purposes, including gaming, finance, and social media. Decentralized apps – also known as “dApps” or “dapps” – are digital applications that run on a blockchain network of computers, rather than relying on a single computer. Because dApps are decentralized, they are free from the control and interference of any single authority. The advantages of dApps include user privacy, lack of censorship, and development flexibility.

Decentralized Applications (dApps). A standard web app such as Uber or Twitter runs on a computer system owned and operated by an organization, giving it full control over the app and its operation. There can be multiple users on a site, but the backend is controlled by a single organization. DApps can run over a P2P network or a blockchain network. For example, BitTorrent, Tor, and Popcorn Time are applications that run on computers that are part of a P2P network, with multiple participants consuming content, injecting or sharing content, or performing both functions simultaneously. In the context of cryptocurrencies, dApps run on a blockchain network in a public, open-source, decentralized environment and are free from control and interference by any single authority. For example, a developer can create a Twitter-like dApp and place it on a blockchain where any user can post messages.

Once published, no one – including the app developer – can delete the messages.

Advantages and Disadvantages of dApps. Advantages Many of the advantages of dApps revolve around its ability to protect user privacy. With decentralized apps, users do not have to provide their personal information to use the app’s function. DApps use smart contracts to complete the transaction between two anonymous parties without relying on a central authority. Free speech advocates point out that dApps can be developed as alternative social media platforms. A decentralized social media platform would be resistant to censorship because no single participant on the blockchain can delete messages or block their publication. Ethereum is a flexible platform for developing new dApps and provides the necessary infrastructure for developers to focus on finding innovative uses for digital applications. This could enable the rapid deployment of dApps in a variety of industries, including banking and finance, gaming, social media, and online shopping. American cryptographer and computer scientist Nick Szabo introduced the term “smart contract” in 1996 as a doctoral student at the College of Washington. Disadvantages The use of dApps is still in its early stages and is therefore experimental and prone to certain problems and unknowns. It is questionable whether the applications can scale effectively, especially in the event that an app requires extensive computation and overloads a network, resulting in network congestion. The ability to develop a user-friendly interface is another problem. Most users of apps developed by traditional, centralized institutions expect an ease of use that encourages them to use and interact with the app. To get people to switch to dApps, developers need to create a user experience and performance level that competes with already popular and established programs. Another limitation of dApps is the challenge of making code

changes. After a dApp is deployed, changes will likely be required on an ongoing basis to make improvements or to fix bugs or security risks. According to Ethereum, it can be difficult for developers to make necessary updates to dApps because the data and code published on the blockchain are difficult to change.

What are Ethereum dApps? They are decentralized applications that are run and developed on the Ethereum platform. Ethereum dApps use smart contracts for their logic. They are deployed on the Ethereum network and use the platform’s blockchain to store data. What is the difference between a centralized app and a decentralized app? A centralized app is owned by a single company. The application software for a centralized app resides on one or more servers controlled by the company. As a user, you interact with the app by downloading a copy of the app and then sending and receiving data back and forth from the company’s server. A decentralized app (also called a dApp or dapp) operates on a blockchain or peer-to-peer network of computers. It allows users to conduct transactions directly with each other rather than relying on a central authority. The user of a dApp pays the developer an amount of cryptocurrency to download and use the source code of the program. The source code is called a smart contract, which allows users to conduct transactions without revealing personal information.

What are examples of centralized and decentralized apps? Well-known examples of centralized apps include Twitter, Facebook, Instagram, and Netflix. Banks and other financial institutions use centralized apps to allow their customers to access their accounts online. Peepeth, an alternative to Twitter as a social network, is an example of a decentralized app. Cryptokitties is a dApp game that allows users to buy

and sell virtual cats. MakerDAO is a decentralized lending service that supports the stablecoin Dai and allows users to open a collateralized debt position (CDP).