Imagine leasing space on your hard drive to companies and individuals around the globe and earning a profit in the process. Consider an app for social networking or a database that holds confidential data that are nearly 100 percent secure from risk of data theft. You could also be playing with an idea that is a bit more ambitious. Blockchain has opened up a lot of possibilities, and what we’ve seen so far is only the beginning of the Iceberg.

Welcoming to the world of decentralized applications! You may be thinking, “Well, what are dApps?” In the beginning Decentralized Applications are a brand new kind of software application that is not controlled by a central entity, and, more importantly, can’t stop functioning by any person and doesn’t experience interruptions. They are free software that utilize smart contracts to conduct transactions using blockchain.

What is dApps?

The idea of decentralized applications is at a very early stage , and therefore, it’s not possible to give a comprehensive answer to the question, “what are dApps?”. From what we have seen up to now, it’s possible to discern some of the most important features of these apps.

First, let’s take a look back and learn about the technology that underlies dApps that is called blockchain. If you’re familiar with the way the blockchain operates and functions, then you should know that it’s a ledger of transactions records, which are organized into blocks, which are connected through cryptographic validation. Each block is tied to its predecessor and its successor and it is not possible to alter the data that is written into the block.

A specific blockchain is the an electronic storage of consensus among the various parties with the transactions chain every transaction is recorded forever and accessible to all involved in the chain. One thing to keep in mind in this case is that the ledger is distributed over multiple nodes, and therefore cannot be located in a central location and is not managed by a single organization.

With the primary characteristics of blockchains as explained previously it is easier to grasp the following essential characteristics of dApps:

Open Source:

Ideally, it should be governed by an independent system, and all modifications being voted on by the majority of its users. The source code of the dApp must be open for inspection.

Decentralized:

The operational data of a dApp need to be kept on a public as well as a distributed ledger (blockchain) to ensure that control is not entrusted to an authority that is centralized.

Rewards:

Validators who are part of the blockchain put in their time (human effort, computer power, and electricity) to validate transactions and also add blocks in the chain. This is why it is essential to reward these people and the most commonly used cryptocurrency is cryptographic tokens.

Protocol:

The decentralized community that is gathered around the application must be able to agree on a cryptographic method to prove worth. For instance Bitcoin and Ethereum both Bitcoin as well as Ethereum are currently employing Proof of Work (PoW) and the latter is researching a hybrid version of PoW/Proof of Stake (PoS).

If these characteristics are taken into consideration as a positive factor, then Bitcoin definitely deserves applause as the very first application that is decentralized to be designed and developed. If you’re in need of an introduction to Bitcoin, Bitcoin is an autonomous public ledger that can facilitate efficient transactions , without intermediaries or the central control of the entity.

Types of dApps

The blockchain-based model which is used, decentralized applications are classified into three types:

Type 1:

These dApps come with their own blockchains, such as, Bitcoin. Other alternative cryptocurrency with their own blockchains can also be classified under this.

Type 2:

This type of dApps utilizes the blockchain technology for Typ 1 apps. These applications are protocols that contain tokens that are essential to their function. Omni Protocol Omni Protocol is the best illustration of an Type 2 applications. Omni is a trading platform built using Bitcoin. It is built on top of Bitcoin blockchain in order to serve as a layer to enable ‘peerless easy, and secure transfer of value or assets with no middlemen.

Type 3:

Type 3 dApps are based on the protocol used by the type 2 application. For instance, the SAFE Network (Secure Access to All) is an illustration of a Type 3 dApp. The SAFE Network is a distributed communications and storage network that replaces data centers as well as servers by utilizing the computing power that its customers. This is an independent data system that allows the development of censorship-resistant websites and applications. It utilizes an Omni Protocol for issuing SafeCoins that then enable its functions.

How does a dApp Differentiate from a Traditional App?

Decentralized apps represent a huge change from traditional applications, principally due to the core principle of decentralization which drives the entire life cycle. Data immutability and trust are another aspect that distinguishes between the two. In contrast to traditional applications that are controlled by an authority that is centrally controlled, dApps are based on a decentralized blockchain , and the information once it is recorded on the chain is not able to be altered or deleted. So, at each stage in the dApp development process it is essential to ensure that you are following rules of the network that are decentralized.

In the scenario of traditional apps, one would assume that once the interface design is finished the app will perform faster because there is less dependence on third-party services. However when creating an app that is decentralized it is essential to think about the trust of users and the ability to scale.

One of the major differences between them is the rigorousness with which the code for a dApp has to be checked before it can be released to the mainnet. Because a smart contract can’t be altered once it is released, it is crucial to make sure that it is error-free. This method of ensuring security by ensuring caution is different from the “fail fast, learn faster” method that is used when it comes to traditional application development.

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