While everyone has been focused on how cryptocurrencies may turn people to become billionaires overnight, the most exciting aspect of this new technology – blockchain — has been overlooked. Cryptocurrencies are powered by blockchain. However, its powers extend far beyond digital currency usage to include a wide range of technology.
Decentralized applications (DApps) are one of the things that blockchain-enabled. Consider an app that shares these characteristics to understand how DApps differ from traditional apps:
- There is no way to turn it off
- There is no downtime.
- Are more resistant to cyber-attacks
- There is no one who owns them.
DApps have a vast potential to transform the way we work, communicate, commute, and much more. DApps can revolutionize the web as a result. There are close to 4,000 DApps as of October 2021 with 162.73k daily active users.
Source: https://www.stateofthedApps.com/stats
We will go through the advantages of DApps and what the future holds for them in this article.
What are Decentralized Apps?
Computer apps that run on a distributed computing environment are known as decentralized applications (DApps). DApps, in other words, are programmes that make use of blockchain technology and run on a safe and dependable network.
It means that DApps are not centralized, resulting in benefits including transparency and the removal of third-party authorities. Peer-to-peer networks like Ethereum, Loom, and Waves host decentralized apps.
Source: To completely grasp the concept of decentralized apps, one needs to be conversant with blockchain technology. Blockchain is a distributed ledger that stores records in linked blocks. This ledger isn’t kept in a single location and isn’t administered by a single entity. As a result, it is transparent and immutable.
Decentralized apps, among other things, aid in the fight against internet censorship while also increasing trust in the system. These are just a few of the reasons why DApps will significantly impact how we use the internet in the future.
The Benefits of DApps
Consider how much money you could make if your car could transport passengers while you were at work. Imagine your computer’s surplus capacity being used to help businesses and people across the world. Consider getting compensated for utilizing applications while you’re online. DApps have the potential to make these things a reality soon.
The fact that DApps are decentralized is, after all, their most significant advantage. Web downtime, security breaches, and other failures or defects have all been experienced by product owners. DApps can mitigate many of those issues. The core benefits of DApps include:
- Open source
- Can work with cryptocurrency as a payment method
- Highly scalable
- No central authority
- Reduction of data breaches
- Users retain control over their data
- Potential to remove transaction fees
- It helps users to generate income
We now have access to DeFi (decentralized finance), a new financial environment free of third-party control, thanks to DApps and blockchain technology. DeFi is based on secure, distributed networks, allowing anybody to access a wide range of financial products and services from anywhere on the planet. Compared to previous systems, this means that people will encounter significantly fewer hurdles to accessing and using financial services.
DApps can support many other changes beyond DeFi. Peer-to-peer markets like Amazon and eBay, peer-to-peer cloud storage like Dropbox or Google Drive, and even a peer-to-peer software market like the Apple App Store and Google Play may all be created with DApps. Overall, they can use decentralization to transform the commercial landscape.
Blockchain technology can be used to power a world in which all online stores, media, content, services, and personal data are dispersed among platforms rather than being stored on a centralized server by large organizations.
One typical concern with free virtual private network (VPN) services is that they track and sell user data to make money. VPN apps that aren’t centralized have the potential to change that. Not only would it eliminate the need to pay for premium VPN services, but it would also provide customers with peace of mind, knowing that when they connect to a VPN server, no one is watching their every step.
DApps in the real world
Bitcoin was the world’s first known decentralized application. Bitcoin, known as the apex cryptocurrency, addresses the issue of centralization by allowing users to conduct transactions without the assistance of a mediator or a central authority via a self-sustaining public ledger.
Source: https://blockgeeks.com/guides/what-is-bitcoin/
When it comes to decentralized applications, we may categorize them based on the scenarios they can be employed. This classification divides DApps into three groups, each of which has its own set of potential applications:
Money Transfer and Management
Decentralized apps can be used to make global money transfers more efficient. The benefits have already been demonstrated in the growth of bitcoin and other cryptocurrencies. By eliminating intermediaries and utilizing the blockchain network and its crypto token, dApps can improve money management, transfer, and lending while increasing security due to the consensus method, which is hard to change without a majority vote.
Business Processes
Companies can use decentralized applications to automate procedures without involving humans. Critical problems may be handled, and process efficiency can be improved with the help of smart contracts, which are an essential cog in the blockchain network. For example, logistics businesses can include RFID chips in their shipments, which can be read at destination ports and used to settle payments instantly via a smart contract between buyer and seller.
Decentralized Autonomous Organization (DAO)
DAO is a brand-new phenomenon in which people create faceless organizations with no leaders. These businesses can operate as a single entity, with regulations set by blockchain programming languages. Everything may be programmed on the blockchain that will govern the organization, including how members will vote, what business segment the organization will operate in, who can be members, and how the value token will be exchanged. These organizations will not be able to stop once they have been deployed, and they will be able to work anywhere globally via the blockchain network.
Examples of DApps that are transforming the app landscape
There are some innovative use cases for DApps that are already changing the app landscape.
Golem
Brass Golem was the original use case for Golem, which takes advantage of idle computer power. Brass Golem promises to improve the rendering landscape for CGI artists by allowing them to rent out substantial computing resources based on their needs. Idle machines are put to good use by developing a decentralized network and allowing them to accept assignments from Golem network users. This is the next level of resource sharing and pooling that Golem DApp has enabled.
Source: https://coinsutra.com/golem-decentralized-sharing-economy-computing-resources/
Status
Status is a peer-to-peer network that allows users to exchange payments and enter smart contracts with one another. Users may stay connected via the messaging system without worrying about server outages because everything is based on the blockchain P2P network.
Ethlance
Ethlance is similar to Upwork, the most popular employment marketplace. However, it is decentralized, unlike Upwork, which is known for its high fees. Ethlance does not charge a fee for contract work or a commission for posting and recruiting jobs. The app is a good alternative to Upwork and other marketplace platforms since it can operate sustainably with 0% fees from contractors or employers.
As with most programming and technology concepts, there are lots of coding options and platforms for developing DApps. They are based on backend code within a P2P network. Typically, a frontend calls to the backend using an API with decentralized applications.
Summary
While DApps represent a positive alternative to the current status quo, the market is still maturing, and it might be some time before we see genuine mainstream adoption. Having decentralized applications as the norm requires a paradigm shift that needs support from the big players in tech. DApps are the future, but it’s hard to say how far away that future might be. One thing is for sure that DApps will lead to greater transparency and privacy on the web, which we desperately need as more organizations digitize their operations.
DApp technology is robust and has potential. For investors, the market is volatile but now could be the right time to dip your toes in the water.
Disclaimer: The author of this text, Jean Chalopin, is a global business leader with a background encompassing banking, biotech, and entertainment. Mr. Chalopin is Chairman of Deltec International Group, deltecbankstag.wpengine.com.
The co-author of this text, Robin Trehan, has a Bachelor’s degree in Economics, a Master’s in International Business and Finance, and an MBA in Electronic Business. Mr. Trehan is a Senior VP at Deltec International Group, deltecbankstag.wpengine.com.
The views, thoughts, and opinions expressed in this text are solely the views of the authors, and do not necessarily reflect those of Deltec International Group, its subsidiaries, and/or its employees.
