Decentralized Applications – dApps

What are Dapps?

Decentralized applications (dApps) run on a P2P network of computers rather than a single computer. dApps are a type of software program designed to exist on the Internet. They exist on the Internet in a way that is not controlled by any single entity. Smart contract and smart wallet are something which are also build using blockchain. Decentralized applications don’t necessarily need to run on top of a blockchain network. BitTorrent, Popcorn Time, BitMessage and Tor are some traditional dApps. These all run on a P2P network but not on a Blockchain.

Dapps have some noticeable common features:

  • Incentivized. Validators of the blockchain should be incentivized. That can be done by rewarding them accordingly with cryptographic tokens.
  • Protocol. The application community must agree on a cryptographic algorithm to show proof of value. For example, Bitcoin uses Proof of Work (PoW) and Ethereum is currently using PoW. While Ethereum plans for a hybrid PoW/Proof of Stake in the future.
  • Open Source. It should be governed by autonomy. And all changes must be decided by the consensus, or a majority, of its users. Its code base should be available for scrutiny.
  • Decentralized. All records of the application’s operation must be stored on a public and decentralized blockchain. That would avoid pitfalls of centralization.

 

Blockchain dApps-

The dApp in the context of Blockchain must meet the following criteria:

  • The application must generate tokens. According to a standard cryptographic algorithm acting as a Proof of Value. Nodes are contributing to the application. While Bitcoin uses the Proof of Work Algorithm.
  • App’s records and data of operation must be cryptographically stored in public. And decentralized blockchain in order to avoid any central points of failure.
  • The application must be completely open- source. It must operate autonomously. And also with no entity controlling the majority of its tokens. The application may adapt its protocol in response to proposed improvements. And market feedback, but the consensus of its users must decide all changes.
  • The application must use a cryptographic token. Which is necessary for access to the application. And any contribution of value from (miners/farmers) should be rewarded with the application’s tokens.

Blockchain may be a bold and distant conjecture, but services such as banking will be made redundant. As the world learns to operate and finance itself by self-sustaining, trust-less and decentralized networks. Large corporations hurrying to secure their place in the blockchain movement is only a testament to that.



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