Decentralized Applications (dApps) - Steemit Crypto Academy Season 4 - Homework Post for Task 8
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1). What are dApps? Explain the working system of dApps? What are the differences between dApps and other applications? Explain the advantages and disadvantages of dApps? How can dApps developers promote their apps? What should we pay attention to when using dApps? How do we find the information of a DApp that we want to know? Provide the steps (Screenshot required).
What are dApps?
DApps is the acronym for Decentralized Applications. A Decentralized Application is an application that is created for a user but is operated on a blockchain. It is called 'decentralized' because since it is operated on a blockchain, it follows the principles of most blockchain technologies that are decentralized in nature. That is, it uses a Peer-2-Peer network as it is the users in the network that play an active role in running the application such as the storage of generated data in the application.
It is made up of codes that render a front-end user interface (UI) that is connected to a back-end smart contract that also makes use of a consensus mechanism in a blockchain network. This makes the system that runs a decentralized application to be open source, as the application events are accessible by anyone which makes the data stored to be difficult to manipulate as each user on the network can access all the data on the system.
Because blockchain technology is a new form of technology that helps to store data in a highly secured fashion, it has become the go-to technology for new applications. The decentralized applications can be found in different categories. Some of them include finance (DeFi), exchanges (DEX), games (NFTs), etc.
Also, decentralized applications are one of their kind in the sense that it allows users to have free control over their accounts. Because there is no single authority controlling the application, users can behave as they wish on the application. Users can carry out operations without being covered up or censored. No third parties are involved during operations and everyone can control their accounts as they wish.
All of the decentralized applications make use of cryptocurrency which is usable within their blockchain network. The cryptocurrency can be in the form of a coin, token, or an NFT. This is because the blockchains use a means by which the transaction that takes place has to be verified and recorded and it is mostly done with their native cryptocurrency. It can also be used to serve other functions like Governance, ICO, etc.
Explain the working system of dApps?
Decentralized applications make use of certain key features in their working system. Without these features, the application would not be regarded as a DApp. One of the intrinsic key features of a DApp is a Smart Contract.
A smart contract is a programmable code that makes sure that agreements between two or more persons are automated and self-executing in a seamless, automatic, and quick way, and is further verified on a blockchain. It is the programmable code that is self-executing that carries out the terms of the agreement. Once an agreement has been reached and operated on the decentralized application, the programmable code is sent to an address in the blockchain as a transaction that goes through a verification process on the blockchain. When the transaction has been executed and verified it is added to a block, this transaction through the smart contract cannot be irrevocable.
Without the smart contract, an application would most likely be controlled by a central authority. It is the smart contract that allows the execution of certain commands given by a user, which is then broadcasted to the blockchain network. It is because of smart contracts that an application becomes decentralized. Because it doesn't need any individual or group of individuals to execute and store the data generated from the operations of users, rather it executes the command code given by the users.
With the smart contract, operations on the decentralized applications are peer-to-peer. That is, they occur directly between two or more users on the network of the decentralized application without the need of a third-party or central figure. This also makes it that the fees incurred in a transaction are less compared to using a third-party protocol for running transactions. The smart contract also makes it that all decentralized applications make use of their native cryptocurrency.
What are the differences between dApps and other applications?
From the explanation given above, we can begin to see the subtle difference between a decentralized application and other (centralized) applications. I shall highlight the things that differentiate a decentralized application from other applications. They are presented thus:
Decentralized Applications
In decentralized applications users have full autonomy over their accounts, asset, or anything related to the application.
The processes involved in decentralized applications are done on blockchain technology.
Transaction fees incurred are smaller when compared with other applications.
The transactions are executed Peer-2-Peer or directly between users on the network, no third parties are involved.
The security that comes with decentralized applications is higher because they operate on a blockchain.
The execution of transactions through smart contracts is seamless, automatic, easy, and convenient.
The transactions that are recorded and stored are immutable because they are processed in blockchain technology.
Other (Centralized) Applications
In other applications the users have to depend on the control of the entity that owns the network.
The processes involved are done by a centralized entity, individual, or group.
Transaction fees are larger when compare with decentralized applications.
The transactions are not executed in a Peer-2-Peer manner or directly because it makes use of third parties.
In comparison with decentralized applications, the security level is lower because they are operated by centralized entities.
The execution is done by intermediaries which make it not automatic, sometimes complex, not quick enough, and not very convenient.
The transactions are recorded and stored in the central servers of the entity which makes it to be mutable.
Explain the advantages and disadvantages of dApps?
While looking at decentralized applications there are some benefits as well as drawbacks that can be experienced while using them. Some of them are presented thus:
| S/N | Advantages | Disadvantages |
|---|---|---|
| 1. | There is zero downtime that is experienced in a decentralized application because it operates on a blockchain network and the network is always ready to serve clients. | Updates on the system are constant but are very difficult to execute because they need the whole participants on the network to update their systems respectively. |
| 2. | It doesn't need the real-world identity of users just an address and signature in the form of passwords to enable users to operate with the application. | Because it makes use of a consensus mechanism to store data it makes performance overhead and scaling hard. |
| 3. | There is resistance to censorship because none of the users on the network has the right to block a user from operating on the decentralized application. | If a wrong transaction should take place there is no customer care to call upon because the system is decentralized, this can lead to a loss of assets. |
| 4. | It secures data because the data from a decentralized application are stored on blockchain technology where the data stored are immutable and indisputable. | Maintaining decentralized applications can be a bit harder because the programmable code and the data published on the blockchain are harder to change. So one should be very careful when operating on a decentralized application. |
| 5. | Because they make use of smart contracts, the computation of data is trustless as they are designed to execute predictably thus giving a guarantee that what is expected is what would happen. | But the processing of the data can be very slow at times and take a longer time than expected to execute successfully. |
| 6. | They do not make use of any central authority or entity. | First-time users need to be acquainted with the application and its technology to have a better user experience. |
How can dApps developers promote their apps?
There are ways in which a developer can promote their decentralized application. The avenues which are commonly used are as follows:
Blogs
One of the most common ways by which a developer can promote their decentralized application is through blogs. This is because blogs are channels where discussions about a decentralized application can be made. Many decentralized applications make use of blogs because it has the power to make them reach their audiences. If you check the websites of most decentralized applications you would see blog sections on their websites.
A very popular blog platform that these decentralized applications also use to communicate with their audience is Medium. This is because Medium is a popular blogging platform where write up ranging from TV commercials to Blockchain technology are posted. It is regarded as a blog host.
Airdrops
Another method by which developers can promote their decentralized application is through Airdrops. Developers distribute their decentralized application tokens to different users' wallets. This method is primarily used to get the attention of prospective users on their platform. Through airdrops, developers create a new network of communities or users that are interested in their project and also decide to invest in the project.
One of the best ways to get involved in airdrops activities is by visiting the airdrops page on CoinMarketCap. On CoinMarketCap, there are different categories of airdrop events that anyone can join.
Social Media
Social Media is another popular avenue that where developers can promote their decentralized applications. Social Media are technologies that have a social feature that helps users interact with one another. This can be done through sharing pictures, information, or the features of a new decentralized application. A very popular social media that existing developers use to promote their decentralized application is Twitter.
What should we pay attention to when using dApps?
While using a decentralized application there are certain things that users of the application should look out for. Below is a list of some of the things to look out for:
Users should check the performance level of the application before planning to invest. If the level of performance is higher to a higher number of users in the application then it means the application is scalable.
Users can check the availability of the tokens on CoinMarketCap. This confirms that the project is an existing one and is official that users can get their native tokens.
User can also communicate with the official account of the decentralized application on social media. This helps users confidence that the project is up and running. It also lets users follow up with new updates on the platform.
Users should be careful of the decentralized application they are using or intend to use. For instance, in the area of airdrops users should be careful not to buy the tokens of the dapp during ICO so as not to buy the token of an impending failed project. Users should try to determine if it is official or not.
Most decentralized applications give users a key and an address with which they can use to access and operate on the platform. Users should be careful in their storage of the keys and addresses.
Users should also watch out for scam projects. As there is an increase in the number of decentralized applications there is also an increase in scam projects, so users should be careful.
Users can follow up on a write-up about the decentralized application on Medium. Through this way, users can get some enlightenment of the project such as its features and benefits.
Users can also try to locate the founders of the project. This reinforces the originality of the decentralized application in the minds of the users.
How do we find the information of a DApp that we want to know? Provide the steps (Screenshot required).
There are so many ways by which we can get diverse kinds of information regarding a decentralized application (dapp). Some of them include CoinMarketCap, Stateofthedapps, Dappradar, etc. I shall use Dapprader to give an illustration as to how a user can derive information on a decentralized application.
Above is the home page of Dappradar. Over here you can navigate to different features on the site. Most of them are found at the top of the page. It has different options such as Rankings, Portfolio, NFTs, Defi, Reports, and Blog.
The way to check for details on a decentralized project is by clicking on Rankings. When you click on it you get to see a list of decentralized applications that are listed in ascending order with number 1 being a higher rank and numbers after it being of lower ranks respectively.
Also at the top is an arrangement of the Top Blockchain Dapps where anyone can click on and get a list of decentralized application that is operating on those blockchain Dapps.
At the top, I clicked on one of the top blockchain dapps Steem. The list of decentralized applications that run on Steem showed. So I clicked on the most popular of them all Steemit.
From there it took us to a page where different information concerning Steemit is given. It shows the number of Users which is at 4.45k, the number of Transactions is 21.92k, the Volume is $7.97, and the Balance is $3.95M. It also has a graphical representation of the Historical Activity regarding Users, Volume, and Transactions. In general, Steemit is #46, #2 in social, and #1 in Steem.
You can also access the Steemit platform by clicking on Open Dapp which can be found at the top of Steemi statistics.
Conclusion
Decentralized applications are the main applications of blockchain technology. It is through these dapps that users can engage with blockchain technology. The dapps are created for users in different categories such as decentralized finance (defi), decentralized exchanges (dexs), games, etc. Through these dapps adoption of blockchain technology becomes quicker. The underlying component of a dapp is smart contracts. Dapps has so many advantages when compared with centralized applications, however, it has some disadvantages of its own.
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