What are Decentralized Apps?

Decentralized applications (dApps) are digital applications or programs that exist and run on a blockchain or peer-to-peer (P2P) network of computers instead of a single computer. DApps (also called “dapps”) are outside the purview and control of a single authority. DApps—which are often built on the Ethereum platform—can be developed for a variety of purposes including gaming, finance, and social media.

KEY TAKEAWAYS

• Decentralized applications—also known as “dApps” or “dapps”—are digital applications that run on a blockchain network of computers instead of relying on a single computer.
• Because dApps are decentralized, they are free from the control and interference of a single authority.
• Benefits of dApps include the safeguarding of user privacy, the lack of censorship, and the flexibility of development.
• Drawbacks include the potential inability to scale, challenges in developing a user interface, and difficulties in making code modifications.

A standard web app, such as Uber or Twitter, runs on a computer system that is owned and operated by an organization, giving it full authority over the app and its workings. There may be multiple users on one side, but the backend is controlled by a single organization.

DApps can run on a P2P network or a blockchain network. For example, BitTorrent, Tor, and Popcorn Time are applications that run on computers that are part of a P2P network, whereby multiple participants are consuming content, feeding or seeding content, or simultaneously performing both functions.

In the context of cryptocurrencies, dApps run on a blockchain network in a public, open-source, decentralized environment and are free from control and interference by any single authority. For example, a developer can create a Twitter-like dApp and put it on a blockchain where any user can publish messages. Once posted, no one—including the app creators—can delete the messages.

Many of the advantages of dApps center around the program’s ability to safeguard user privacy. With decentralized apps, users do not need to submit their personal information to use the function the app provides. DApps use smart contracts to complete the transaction between two anonymous parties without the need to rely on a central authority.

Proponents interested in free speech point out that dApps can be developed as alternative social media platforms. A decentralized social media platform would be resistant to censorship because no single participant on the blockchain can delete messages or block messages from being posted.

Ethereum is a flexible platform for creating new dApps, providing the infrastructure needed for developers to focus their efforts on finding innovative uses for digital applications. This could enable rapid deployment of dApps in a variety of industries including banking and finance, gaming, social media, and online shopping.

American cryptographer and computer scientist Nick Szabo introduced the term “smart contract” in 1996 as a graduate student at the University of Washington.