A decentralized application (dApps or decentralized application) is a type of software that runs on a blockchain network. Unlike traditional applications that run on centralized servers controlled by a single entity, dApps operate on a decentralized network, which means that their functionality is distributed across multiple computers (called nodes).
Key characteristics of a Decentralized Application (dApps)
- Decentralization – The stored data and management of the application is based on a distributed blockchain network, not a central server.
- Open-source – Source code is publicly accessible, allowing users to inspect the app and contribute to its development.
- Use of a digital token – dApps use tokens to facilitate payments, rewards, or other app functions.
- Advanced cryptography – To guarantee user security and privacy.
A well-known example of a dApp is the decentralized financial platform Uniswap, which enables transactions between users without the need for intermediaries.
How does a dApps/Decentralized Application work?
dApps work through a blockchain using smart contracts. Here’s how it essentially works:
- Blockchain – This is the underlying infrastructure. The network allows transactions to be recorded and executed in a secure and immutable way.
- Smart contracts – This is the code that defines the rules of the application. Smart contracts run automatically when certain conditions are met.
- User Interaction – Users access the dApp through a user-friendly interface (often a website), but all functionality is supported by blockchain and smart contracts.
For example, if you use a decentralized dApp for a cryptocurrency exchange, smart contracts ensure that the transaction is executed automatically and transparently between users.
Why use a decentralized application (dApps)?
Economics. Security. Freedom. These are just some of the major advantages of decentralized applications. Here’s why dApps are so popular:
1. No middlemen
dApps eliminates the need for traditional intermediaries (banks, technology companies, etc.) to manage data or process transactions. This means lower costs and more efficient use.
2. Transparent
Tired of not knowing what goes on behind the curtain of traditional apps? With dApps, the process is transparent because everything that happens on the blockchain is visible to the public.
3. Enhancing privacy
You no longer need to provide personal data for access. By design, dApps offers a high level of privacy and security.
4. Immutability
Data fed on the blockchain cannot be modified or deleted by a third party entity, which guarantees the integrity of the information stored.
5. Full user control
You have complete control over your activities, and the lack of a central point of failure makes the app extremely resilient.
Steps to access a decentralized application
Think you need advanced technical knowledge to use dApps? No way! It’s simpler than it looks. Here’s what you do:
- Download a digital wallet(MetaMask or Trust Wallet are suitable for beginners).
- Buy the cryptocurrency needed for transactions (such as Ethereum).
- Visit the desired dApp platform and connect your digital wallet.
- Follow the app’s instructions to get started.
Are you an investor thinking of buying or selling cryptocurrencies? On our website, the “Cryptocurrency Price List” page provides you with the up-to-the-minute rates. Furthermore, you can use the cryptocurrency profit calculator to quickly and accurately estimate your profit or loss based on the buying and selling price, along with the amount invested.