Dapps

The Tech

Intermediate

By Matt Hussey

Learn

Jan 21, 2019

Decentralized applications are a new way of cutting out the middleman. They also integrate cryptocurrencies. But will anyone use them?

What you will learn

What you will learn

What Dapps are, what they can do and why they are useful.

It’s time to cut out the middleman. Why pay for a company to provide a ride-sharing service when you could use an app that connects you to the riders and doesn’t take a cut?

What is a Dapp?

Dapps, are decentralized apps. They are like normal apps, and offer the same functions, but are run on a peer-to-peer network. This can be a blockchain. The main elements are:

  • It must be open-source and operate on its own without any one entity controlling it.
  • Its data and records must be public.
  • It must use a cryptographic token which doesn’t have to be its own.

What are the benefits of Dapps?

Dapps have several exciting aspects:

  • 👮 Censorship-resistant - With no single point of failure, it’s very difficult for governments or powerful individuals to control the network.
  • ⬆️ No downtime - Relying on a peer-to-peer system ensures the Dapps continue to work even if individual computers or parts of the network go down.
  • 🔗 Blockchain-based - As they are made of smart contracts, they can easily integrate cryptocurrencies into the basic functionalities of the Dapp.
  • 📖 Open-source - This encourages the widespread development of the Dapp ecosystem enabling developers to build better Dapps with more useful or interesting functions.

What are the weakness of Dapps?

They also have some downsides:

  • 💻 Hacks - As they are run on open-source smart contracts which hackers can analyse and probe for weaknesses, Dapps are prone to hacking and this can compromise user funds.
  • 👨‍💻 Usability - A lot of Dapps have poor user-interface but this is something that should improve over time.
  • 👨‍👩‍👧‍👦 Users - Dapps struggle from low user-numbers which can make them less interactive.
  • 👮 Censorship-resistant - This ability to operate with such freedom has resulted in Dapps such as Ponzi schemes, exit scams and so-called assassination markets.

What Dapps are out there?

State Of The Dapps lists around 2,000 Dapps built on the Ethereum network. However, some of them are abandoned or broken.

The most popular Dapps are decentralized crypto exchanges. These enable people to swap one cryptocurrency for another

DappRadar lists 60 Dapps on EOS, a cryptocurrency focused on fast transactions and micro-transactions.

What are CryptoKitties?

CryptoKitties is one of the most notorious and used Dapps on Ethereum. It hit the news when high levels of transactions started to slow down the Ethereum network.

In the Dapp, users buy, breed and collect digital cats. These cats represent unique digital tokens built using the Ethereum ERC-721 standard. This means nobody is able to duplicate or steal them.

Read more about CryptoKitties

Did you know?

The most expensive CryptoKitty was sold for $170,000 and the one-millionth CryptoKitty, called Vulcat, was born on September 13.

What is Fomo3D?

Can’t help but want to find out? It’s an exit scam. Proud and true.

This exit scam is an Ethereum-based Dapp where users put in a small amount of Ether and the last person to do so wins the pot. Sounds simple right?

Not so. Bots are programmed to automatically bid on the game, theoretically ensuring that it will continue forever. However, someone managed to win it. By making countless transactions with high transaction fees, the hacker clogged up the Ethereum network so the bots couldn’t make their transactions. This meant nobody bidded on the game and the rewards were distributed.

Did you know?

The anonymous hacker who pulled off the exit scam received 10,469 ETH, worth $3 million at the time.

The future:

Dapps could take off as the way to interact with services, play games and exchange money. They offer a censorship-resistant environment for developers to get creative. However, this freedom might come back to haunt them if governments decide that they need to crack down on them.

The question is, can they?

By Matt Hussey

Learn

Jan 21, 2019

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2019 © Decrypt Media, Inc. All Rights Reserved.

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