The blockchain craze has gone in full swing over the last few years. Investors, tech experts, and enthusiasts set high hopes for this decentralized technology to innovate multiple verticals. Decentralized finance, in particular, is poised to blaze the trail and upend bureaucratic traditional processes.
Today, we’ll have a look at one of the most exciting applications of decentralized finance – dApps.
Fundamentals of decentralized applications
DApps or decentralized applications are a relatively new phenomenon that owes their existence to decentralized finance services. Today, the total number of dApps that rest on the Ethereum platform has reached almost 3K, according to DappRadar.
A whole host of factors has led to dApps being among the most popular technical solutions. Accelerated digitalization, play-to-earn models, and the surge of blockchain are just a sliver of the core dApp enablers. Burgeoning blockchain platforms, an acute need for fast and secure online transactions as well as increasing online trading and gaming volumes are expected to fuel the further dApp growth. According to Emergen Research, the market will hit over $368 billion in 2027.
So, what are dApps? DApps are decentralized applications that run on a blockchain network. They’re typically open-source, which means that anyone can view and copy their code to make improvements or recreate them entirely. This also means you don’t have to trust someone else to run it—you’ll be able to run the program yourself.
The 5 core principles of dApps
Decentralized applications are a unique blockchain-based technology. On the one hand, dApps are similar to traditional applications. On the other hand, the backend of decentralized applications is what sets them apart. Here are some other differentiators of dApps.
1. Open source
The code for the platform is available to everyone and can be viewed by anyone. This means that there’s no central authority controlling the development, additions, or changes made to the codebase.
2. Decentralized
This refers to how decision-making power is spread out between different people or entities on a blockchain network, rather than being concentrated in one person or entity (such as a corporation). A good example of this would be Bitcoin where any miner can mine new tokens. In contrast, when you deposit money into your bank account they’re not just going to let anyone have access to your funds without some kind of identification first.
3. Peer-to-peer
This refers to direct interactions between two parties without having an intermediary involved such as a bank or other financial institution like PayPal for example (which isn’t decentralized).
These kinds of interactions are often called trustless because both parties don’t need each other’s permission before sending/receiving money from one another; it could reduce friction which makes transactions much faster too.
4. Smart contracts
These are software code that is executed automatically once the predetermined actions are carried out; smart contracts power the backend of decentralized applications and serve as a controlling entity.
5. Interoperability
Unlike traditional applications, dApps can connect with other decentralized solutions to share the information across the blockchain.
How to create your dApp in 2022
First and foremost, dApp development is similar to building a traditional app if we’re talking about interface. However, the foundation of dApps is different from standard mobile development. Therefore, your development team should be proficient in writing smart contracts with no vulnerabilities. Once your smart contract is deployed, there’s no way of updating it.
Another thing to consider during dApp development is user experience. Decentralized applications are notorious for having poor UX due to being relatively young. Therefore, you should hire a UX/UI team with hands-on experience in dApp development.
There are many benefits to building your dApp, but it’s important to do your research first—you’ll need to learn about blockchain technology and cryptocurrency before you begin. Once you’ve got the basics down, however, it’s time for rapid prototyping! The best way to build an MVP prototype is by using modern frameworks like React or VueJS that provide pre-built components built around popular web standards such as CSS3 or HTML5.
Finally, Minimum Viable Product is a surefire method to bring down development costs and make sure your app is up and beyond user expectations. This is an early version of your product with an ascetic set of core features. When your MVP is ready and launched to the public, it gathers feedback from real users. Once the feedback is ready, your developers act on it to enhance your solution.
The future of dApps
The future of dApps is bright. The space is growing, and more developers are learning how to create dApps every day. As technology advances and our understanding of blockchain deepens, we will see an influx of new possibilities for dApps that have the potential to reshape the way we interact with one another and with products on a daily basis.
Currently, Ethereum, EOS, and TRON are among the most popular options for dApp development. As for types of decentralized solutions, games, crypto markets, and auctions are leading the competition.
Conclusion
DApps are the future of the web. They are a great way to build a product that can scale, provide innovative functionality and safeguard user privacy. However, the future of decentralization is wrapped in uncertainty due to the young age of blockchain and the shaky ground of crypto assets. As the market demonstrated resilience, we’re likely to see more decentralized solutions surface in the coming years.
