As blockchain technology is gaining massive adoption, cryptocurrencies and digital tokens - in particular their potential to disrupt various industries - are of growing interest. Decentralised applications, or dApps, are arguably the most proggressive innovation of the blockchain world. With numerous use cases, developers are constantly introducing impressive dApps in all kinds of industries from finance to gaming to education, you name it.
In this article, we will explain how do dApps work and how to get started with the world of decentralised applications.
What are dApps?
At first glance, dApps look similar to any other mobile application on your device. The key difference lies in the backend technology: compared to standard apps that run on centralised computers, dApps are based on a peer-to-peer network of servers. The majority of dApps can be found in DappRadar and downloaded from Apple Store or Google Play.
What differentiates dApps from regular mobile applications? First of all, decentralised applications are open source, which means that they have a publicly available source code and use blockchain to record operations and store data. It implies that dApps are more secure and transparent when it comes to operations that they are designed to carry out. Moreover, most dApps incentivize their users by rewarding digital tokens for being active or simply using the platform. A digital token is an important feature of any decentralised application as it enhances transactions on the blockchain and adds value to the platform.
As the "2020 Q1 Dapp Industry Review" carried out by DappRadar suggests, the biggest number of active users is concentrated in Finance and Decentralized Exchanges dApps, or DeFi, which have a shared volume of about $11B in Q1 2020. As a result, the flourishing DeFi sector accounts to 84% of the total Ethereum dApp volume.
The most popular dApps and their blockchains
In 2020, Ethereum remains the most successful blockchain for creating and running decentralized applications, which gave life to over 2500 blockchain-based applications. You can read more about and Ethereum dApps in our blog. At the same time, Ethereum is not the only blockchain that is widely used for dApps development. EOS, TRON and NEO blockchains are also popular choices for dApps, which have their own pros and cons.
CryptoKitties has disrupted the cryptocurrency community back in 2017 and is still actively used by those interested to join the decentralised world due to its entertaining idea and remarkable simplicity. What is CryptoKitties? All you need is to purchase digital kitties, raise them and sell for a real profit. Keep in mind that you need Ether (ETH) to buy, sell and breed your digital pets. In our previous article, we explained how to buy Ethereum with Safello. At the peak of popularity, CryptoKitties amounted for around 10% of Ethereum’s transactions per day and made a great contribution to the network’s development.
“CryptoKitties is, at its core, about the cats. It’s about the fun of creating these unique digital creatures, breeding two together and never knowing exactly how it’s going to turn out. It’s about chasing specific traits and Fancy Cats and being delighted by the happy accidents that might just create the dream Kitty you never knew you wanted”
Decentralised exchanges (DEX) have a number of undeniable advantages such as reliability, security and anonymity. At the same time, their main problem is low liquidity, which often means that DEX have volatile prices and slower trading. Uniswap is one of the most well-known Ethereum-based decentralised exchanges which offers a great solution to this long-standing issue. It enables the platform to swap ERC20 crypto tokens without counting on users creating sufficient liquidity. Uniswap does not take fees or involve third parties which makes it a very attractive option for those who want to swap ERC20 tokens.
Blockchain Cuties is another crypto adventure game in which you get to play with digital cuties - lizards, kitties, bear cubs, puppies and other creatures. Similar to CryptoKitties, you will get an opportunity to collect, breed, style and level your crypto pets up with the help of smart contracts on Ethereum, TRON, EOS and NEO blockchains. Every digital cutie is unique and belongs to a player.
With almost 100 000 daily users, EOS is a popular blockchain which is widely used for commercial-scale dApps. Currently, there are over 700 EOS dApps and the most well-known ones include IPSE (web 3.0's search engine), Everipedia (blockchain-based Wikipedia), Sense Chat (decentralised Messenger App), and many others.
InterPlanetary Search Engine
IPSE (InterPlanetary Search Engine) is an EOS blockchain-based search engine which aims to replace traditional HTTP and become a backbone of Web 3.0. with the help of innovative InterPlanetary File System technology. Compared to traditional search engines like Google, IPSE is more secure, decentralised, tamper-resistant and protected from Ad tracking. The platform offers token rewards for those users who share important or high-quality data.
Moonlight is a decentralised recruitment network based on NEO blockchain which offers a unique matchmaking mechanism based on smart contracts. Among the project's key features are professional identity management, verified resumes, profile analytics and decentralized staffing.
With its native TRX token, TRON aims to create a fully decentralised internet based on blockchain technology. Popular among high-volume cryptocurrency gaming and gambling sites, this blockchain provides an innovative ecosystem with high transactions speed, great scalability and low fees. Moreover, in 2020 it became the most actively used blockchain ecosystem when it comes to active dApp users daily.
To sum up
From "decentralised Google" to "decentralised Wikipedia" to "decentralised LinkedIn", modern technologies offer more secure and transparent alternatives to many popular applications that we use in everyday life.