Steemit Crypto Academy Season 3 Week 7 - Homework Task for @wahyunahrul | Decentralized Apps (DApps) - Future Apps From Blockchain System
Image created by me using canva
Hello everyone, I hope you're all doing fine. The same goes for me.
In this post, I'll be posting the homework task for the crypto professor @wahyunahrul.
As you can get the idea from the Title, this homework will solely be based on Decentralized apps or DApps. We'll talk about the Dapps, their pros and cons and their future in creating the cryptocurrency blockchain.
We'll also see how secure are these apps and how their mode of public promotion works.
Will DApps be able to replace centralised applications in other fields in the future?
First, we need to know what a centralised or decentralised application is and its advantages and disadvantages to answer this question. we'll also see both of their examples and uses to get a better understanding
After that, we can compare both of them and tell if the DApps can replace centralised apps or not.
The word "centralised" means: The control is under some authority or industry. It can be an organisation powered by the government or a private organisation.
A Centralised crypto transaction application or centralised application is the platform where a person can buy or sell crypto assets. They act as a third party between the user to user transaction. And to do the same, that person has to trust the third party organisation—these third-party organisations track, monitor and process the trade on behalfs of both sides. I.e. the buyer and the seller.
following are some examples of centralised applications:
Binance.
Huobi Global.
Coinbase (Pro)
Kraken.
Bithumb.
Bitfinex.
Bitstamp.
KuCoin. And many more.
Asset Liquidity: One of the best advantages of using centralised exchange applications is that they provide significant liquidity to the crypto asset. Due to this, The asset can be bought or sold quickly without significant change in price, which helps in minimising the chances of loss.
Tracking Protection: The deals tracked by third-party organisations cannot be tracked by any other means, even with the blockchain.
User Verification: These require Verified personal info. It gives users many advantages like increased withdrawal limits, support team privileges in case of technical errors and password recovery services in case of lost and forgotten user ID passwords.
- Risk of Hacking and trojans: As the exchanges are centralised and managed by the companies using private servers, the system is primarily exposed to the hackers and other trojans who are responsible for crypto hack incidents
For example, Mt. Gox once was the largest crypto exchange company globally. Still, in 2013, it got bankrupt when some hacker hacked into the system and siphoned 850,000 bitcoins leading to the company's suspension.
- High Transaction Charges: This is another disadvantage of using centralised exchange applications (although, in my opinion, paying some amount for the security of an asset is not a bad deal). The centralised exchange platforms charge high transaction fees for their services. The charges vary and are directly proportional to the trading amount. The more significant the amount will be, the higher the transaction fee will be applied.
The word decentralised means the network is a distributed one. To be simply putted: Transaction or exchange of a crypto asset without any third party involvement. And as you may know, Application means software, which provides an interface for the user to interact with the system.
A Decentralized Application allows all the users to play an active role in running the application so that there will be no need for a third-party organisation. It runs on an open-source system that anybody can access so that the data cannot be manipulated.
Some examples of DApps are:
Polyfund
Cryptoblades
Pancakeswap
Alien worlds
Splinterlands
Autofarm
Upland
Uniswap and many more.
the data above is collected from the website DappRadar
- Low-Risk Factor: As there is no third-party organisation involved, the chances of being hacked are meagre.
NOTE: This does not mean that this is a full proof security system. Nothing is 100% secure as we live in a world where technology is growing exponentially. But as compared to centralised systems. Yes, it is secure.
- No Server Failure: DApps cannot be shut down as there are no servers behind the working mechanism. As the mechanism is decentralised, the data is distributed across the nodes present on the blockchain in which every node is independent. If a node fails to do the allocated work, the other one will take place and run data across the network.
Anonymity: Decentralized applications do not require any private information or KYC verification.
Open Network: this means that anybody can create tools and Utilities on the networks. With this, people can create something new, which helps the traders make trading decisions.
THE WWW(World wide web) is a great example of such open networks which provides opportunities for other small networks to grow.
No Password Recovery: As the DApps promote decentralised systems with no third party involvement, a user must remember his password. Otherwise, there will be no recovery of the lost password and other credentials. In such a case, all the crypto assets that the user has created will be lost permanently.
Liquidity: As the DApps are still under the development phase and most people don't know about them, centralised applications facilitate 99% of transactions in the crypto world.
As 99% is a vast amount and affect the trading volume. It leaves less trading volume for decentralised applications, due to which they face less liquidity issues and the chances of getting buyers and sellers become pretty low.
- Complex System: As it is a whole new generation of crypto concepts, the interfaces are difficult to use from the user perspective, which leads to less understanding of users in them and ultimately leads them to shift over centralised systems.
Now we've seen all about centralised and decentralised apps; we can compare both of them in different aspects such as usability and security.
We discussed that there are chances of centralised systems getting hacked, but the case is not the same with the DApps, as there is no third-party organisation involved in the transaction. It is a peer to peer system or a network that runs over a blockchain.
Blockchain technology does not run on servers; instead, it uses network nodes to transfer data units. So If any node fails, another one will complete the task, but that's not the case with centralised apps which works on servers. If the server fails, the whole centralised system will be down in no time. In such a case, the centralised application users will not be able to use it, which can cause a loss in the crypto market as the prices of crypto assets are highly dynamic in nature and keep changing with small intervals of time.
DApps have a transparent system and which is resistant to hiding user info. Unlike other centralised social media platforms where bounds are present on a user's opinion, DApps provides the users with privileges to share what they want to as there is no organisation present over them to oversee or judge them. With this treatment, everyone has equal rights.
Also, a great advantage offered by Dapps is that the data cannot be manipulated because the information is present on the blockchain networks. These networks are open and can be accessed Publically from all over the world.
The Dapps the growing exponentially in the crypto market. It promotes blockchain advancement and expands it to new lengths.
I think they will surely take over centralised application systems as they offer many advantages over centralised applications. The Dapps need low maintenance and can provide services in any environment like natural disasters, political outbreaks, and other mishappenings. These features give Dapps an upper hand over centralised applications.
Is there a possibility for DApps to steal user data?
DApps offers a high level of security as they run on blockchain technology. Blockchain does not work on servers. It uses nodes and interconnected peer to peer networks which are highly secure due to no third party involvement. Blockchain is a system that registers the information in such a way so that the stored information cannot be changed.
Every block in a blockchain has a number of transactions that it contains inside of it. The user's ledgers are updated every time a transaction takes place. Keeping these properties of blockchain in mind, we can say that the Dapps are highly secure in nature.
As the transaction and other processes are transparent due to the open-source nature of the blockchain, there are minor possibilities of data theft and other hacking practices. Even the Dapps developer's transaction is transparent, so they cannot steal any data.
DApps do not require any user information and KYC verification, So if there is no personal user data present on the system, it cannot be stolen. However, the only way to lose user data is by forgetting login and wallet credentials. As another organisation or a government body does not control Dapps, it does not provide customer support.
Explain the ways in which a DApp promotes its application to the public
In this era of technology, there are many ways to market a product. DApps use many different methods and platforms to promote themselves.
Some of the methods are listed below:
- These are the website that promotes DApps. These websites explore the different features of the DApps and promote through How to use and insight details.
Some of the websites which promote Dapps are :
DAppRadar
DAppReview
StateoftheDApps etc.
These websites show the new listed Dapps and divide them into different categories. Such as NFTs, DEFI, Games, ExchangesExchanges and many other categories.
The screenshots below show the homepages of the websites.
Also, there are many sources and websites from which Dapps can be promoted.
Social media holds 53.6% of users worldwide, saying that it is a great way to promote anything. So the Dapps also uses these new ways to promote themselves. There are countless platforms that charge users to promote an asset.
Some of the social media platforms are listed below:
Facebook
Instagram
LinkedIn
Telegram
Reddit
Twitter and many more.
Yes, ICO is a way to raise funds when a firm wants to create a new service, asset, token, app or coin.
The method is very popular among investors. The new DApp can be promoted easily as the Dapps have integrated currency or token associated with the application. The funds raised with ICOs help developers to develop the Dapp further.
There are many other events by which a Dapp promotes itself, like ICOs, IEOs, IDOs, Airdrops, etc. All these events promote DApps.
It is a type of ICO which is directly operated by Cryptocurrency Exchanges. In IEO, crypto funds are raised on behalf of crypto project owners, and in return, they get the listing fee or a percentage amount of the token sale. This practice helps both investors and developers to develop the system further. On the marketing view, it attracts many investors and developers as they get some amount from the offering funds.
A Fundraising event in which a net token is launched on a decentralised exchange. Yes, it's a blockchain project which can be said a new token's debut. It is a fundraising event in which investors invest their funds in the new crypto token.
Dapps can be promoted with this practice. It helps to raise funds and add the token or the app to the social platforms, which promotes the application itself.
Airdrops are the events in which a crypto token is distributed for free to some random wallet addresses. As it is a way of gaining attention and make new followers, it is used for Dapp promotion.
Choose a DApp and do a detailed analysis that proves that the DApp is a good one to use
Let us go to the website that provides data on Dapps. I.e DappRadar .
I am using Uniswap as I've used this platform a lot and have a good understanding of its features. Also, it works with DEFI(decentralised Finance) and Etherium as a core token.
Image taken from DappRadar
At the time of creating this homework, the current details of this Dapp are as follows.
Rank 17
Token price $ 29.76
Users 31.5k
Transactions 81.54k
Volume $900.79M
Balance $3.53B
Image showing App Details.
Now click on the open dapp icon.
Image showing Wallet options.
As you can see in the screenshot above that it will ask you to connect a wallet.
Now click on connect wallet icon
Image Showing wallets.
After clicking on connect wallet, it will show a popup menu of all possible wallets that you can connect.
I am choosing Metamask as I already have a wallet in it. If you don't have a wallet, it will show you an install option.
You can install then work on the Dapp.
Image showing Metamask wallet
It'll pop up a window showing your metamask account. You can click on next and then click connect.
Image showing wallet connected status.
It'll show that your wallet is connected to the Dapp.
Image showing tools in the Dapp.
It basically contains four features Tab menu tools and 7 Assisibility tools. And, of course, an exchange transaction menu.
Swap: This is used to swap one token to another.
You can select the token you want to exchange and enter the amount you want to exchange.
Image showing pool menu.
Pool: This option shows all the top pools and liquidity. You can also use the option named View 2 liquidity, and it will show you options like liquidity provider rewards, and you can also create your own pair or import pool and Add your V2 liquidity.
Image Showing V2 liquidity options
Image showing vote option.
Vote: This option shows a list of third-party programmes where you can vote and create proposals.
Image showing chart option.
Chart: The chart option shows the Uniswap overview, the Tvl and 24-hour volume charts. You can view pools and tokes from the menu above on the right and search pools and tokens using the search bar present at the top.
On a bit of scroll down. It will also show you the top tokens and top pools according to their trading volume.
As I've talked about, the reason for choosing this earlier. That I've used this Dapp before, and I am very familiar with the working and stuff.
Other than that, it is very easy is to use and offers a large number of exchange pairs for Cryptocurrencies. It also works with etherium tokens and supports Defi(decentralised finance).
It is very easy to set up, as I've shown in the images above, and no user data and credentials are required. That's the main reason for me to using this app.
As I've been using this app for a long period of time. As a user, I can say it's very secure and fast in making transactions.
If you were a DApps developer, what kind of app would you like to create?
The answer is very simple if I were a Dapp developer, I would like to create a Dapp that has an integrated system for both Type 1 and Type 2 DApps.
From Type 1 properties, I would like to create a system that runs for the financial systems and have its own blockchain. The Cryptocurrency I have in mind for that blockchain is Cardano. I choose Cardano because it offers Etherium's most capabilities and shows significant trend changes in a short amount of time.
It holds the fifth-largest Cryptocurrency position by market.
As I've told I'll be integrating Type 1 and type 2, the Dapp will show all blockchain activities on the live feed and have users to pay tokens to view and compare the performance of the assets.
As type 2 uses its own tokens as transaction tools, I'll be using that point for the user to pay for an analysis made by the system.
As I have an interest in artificial intelligence and have been actively creating A. I software such as analysis maker and trend calculators, I'll be using my A. I technology to create such a program in the Dapp environment by which a user can ask an A. I to predict the following possible trends. As you may know, there is no certainty of the crypto market, but my system will show close results to the user as new modern users do not know all the concepts and traditions that professional investors follow... So the system will also guide such new investors on How to use Dapp and its tools.
I'll use the ICO process to raise funds and provide the token to the investors in the Dapp. The token price will be low, which will ultimately bring the attention of investors to my Dapp, and they'll be using my A. I tools to predict market trends and how to study them.
The name of my dapp will be Ethcypher and the token it'll offer will be CPH token.
DApps are the new technology which are based on blockchain systems, offering more security and services. It is better than the centralised systems that we already have.
I believe they'll be the revolution in the crypto exchange world and work in favour of users.
Dapps are evolving at exponential rates as with the technology, and they show self-sustaining properties. They're not just for making payments; they're more than that.
Banking services can also be adept at blockchain systems, sparing a lot of time and human effort.
I think after some time in future the Decentralized apps will be replacing the centralised systems as they offer transparency over anything and transparency leads to trust development.
That'll be all from my side. Being able to gather such knowledge, I am truly blessed and wanted to thank professor @wahyunahrul to deliver such an amazing task.
I saw that among the dApps you reported there are also blockchain-based games, which in your opinion is the best blockchain-based game?
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