Blockchain DApps and their Relevance in the Blockchain Space

What are Blockchain DApps and their Relevance in the Blockchain Space

Most people often relate DApps to the Ethereum blockchain. This isn’t totally wrong as the Ethereum blockchain was the first major Blockchain-based platform to be adopted for DApps development. Even in its white paper, Ethereum stated its intention of creating a protocol for building DApps. Ethereum was successful in being the first blockchain to utilise its own language, Solidity to enable developers to create smart contracts through a Turing complete language. But what exactly are dApps and what’s their function in the blockchain space?

What is a DApp?

The term DApps is a combination of two words, decentralized + applications. While they have the traditional features of traditional applications, DApps are applications that are run with trustless protocols on a decentralized network.  Basically, DApps are software applications which mean they are available on the web. However the little twist is that they run on a peer-to-peer computer network, and are controlled by many users rather than a single PC. Power is distributed and not concentrated and users are rewarded with tokens for contributing computing power. So while Apps like Facebook and Twitter are centralized making it easy to suspend your account, DApps are decentralised and it takes a general consensus from computing powers before anything can be done.

Does the Blockchain Ecosystem need DApps?

There exist some level of similarity between the blockchain protocol and DApps, however, DApps offer solutions in a more sophisticated way.  Some of the solutions DApps offer include bridging the gap between businesses without the need of a third party and this is where Smart Contracts come to play. Smart contracts are self-executing contracts, the terms of agreements are written into lines of code and transactions can be conducted between the two parties with the terms and conditions binding them. However, a DApp can use smart contracts for the execution of commands on the blockchain.

While the potential of DApps include, Improving Data Ownership Rights and IoT Integration as well as enhancing Digital Security, its relevance has been questioned. Asides the Ethereum blockchain, EOS and Tron blockchains are also DApps-powered blockchain. Currently, Ethereum has a total of 1,375 live DApps and according to data from DAppRadar only 200 of these DApps had one or more users. On the other hand, there is a total of 1,828 “live” DApps across all blockchain platforms, 85% of them had had 0 transaction volume while 77% of them had no users at all. These data by DAppRadder was brought to attention by Kevin Rooke, a Twitter user on February 9th, 2019.

Rooke explained in the tweet that compared to other DApps competitors (EOS & Tron), developers focus on producing software on the Ethereum blockchain. A report by researchers at Diar publish in January 2019, indicates that at the time, EOS DApps accounted for 55%, of on-chain USD volume, Tron had  38%, while Ethereum applications had just 6%. The fact however remains that DApps built on the Ethereum blockchain do not seem to have lived up to their expectations.

On the relevance of DApps, bitcoin author and advocate Saifedean Ammous stated, “perhaps some gambling dApps will see traction” and that distributed apps could potentially see more adoption because they are “much more difficult for governments to regulate [and/or] shut … down.” While a possible future for DApps beyond gambling is foreseeable, improvements seems to be ongoing to improve the technology.

What do you think about the relevance of Apps in the blockchain ecosystem? Share your thoughts with me in the comment section below.