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What Are dApps And How Do They Work?

Blockchain has the potential to transform how technology interacts with our lives. Therefore, it is essential to mention blockchain apps, their advantages, and how to use this technology for your company. Decentralized applications or dAppps are applications that are not managed by a third party and where it is also possible for users to interact directly through the blockchain.
Key Points

What Is A dApp?

The first thing to say is that blockchain apps, or dApps, are entirely decentralized. The blockchain network has no intermediary figure between users who want to exchange information, messages, or money, and those who receive it.

Everyone in the network is a user and a mini-server simultaneously, and they are also responsible for verifying and sending data.

How Does a dApp Work?

Before knowing how a dApp works, it is crucial to understand how a blockchain network works.

A blockchain is a network that allows all information to be shared with its peers to store information chronologically in blocks. This means that once a data exchange or transaction occurs, it is shared with all network members, and all members have a record of all movement on their devices.

These data blocks are stored in a chain; once the data is incorporated, it cannot be modified or deleted. This makes the blockchain virtually unbreakable.

To create a blockchain, you must use gigabytes to terabytes of storage. However, since mobile devices do not have a large storage capacity, dApps usually only operate with one part of the chain.

In the case of a blockchain network, any user can access it through any device. All network members can access the code that allows the verification process of transactions and be able to share information with other members in an anonymous way. An example would be Bitcoin.

In contrast, the blockchain network with permissions only gives access to authorized members. All members have licenses, and each has a specific role in the network. A permission-based network has rules that regulate transactions between network participants. This type of network is perfect for managing operations within a company.

An example of this type of network where it can be implemented is financial banks since sensitive customer information is handled within the company and must be regulated to avoid any attack and loss of sensitive information.

Benefits Of dApps

The blockchain network is a secure and fast way to make transactions. It is entirely transparent, allowing anyone to consult any transaction history. Let's explore many more of the advantages of dApps.

Security

Security is one of its main advantages, since being an application that is running on a network formed by nodes, it provides protection, no matter if one or several nodes of the network goes down.

The opposite happens with centralized applications since their operation depends on a central server. If this server suffers some attack, the service is affected; consequently, the application may stop working for unlimited time.

The dApps are transparent and unmodifiable because it uses blockchain technology. All information is kept in the blockchain; any member can access it. Transactions are constantly registered, and no one can modify or delete them. This ensures that dApps are entirely transparent and verifiable.

Decentralization

One of its most significant advantages of dApps is that they are fully decentralized, not requiring any third party to exercise any control. This is especially true for applications requiring a high fault tolerance level.

It can also be considered as a competitive advantage since the more time passes, the larger the network that serves as a support for the dApp becomes, generating more nodes t within the system, making it much more difficult for it to crash or collapse.

Built On Free Software

Another of its great benefits is that its construction has been developed on free software. This enables a community of developers working to provide support and better service to the network, in addition to achieving high levels of security and transparency

Classification System

It is essential to highlight that in the dApps world, different categories coexist:.

● Level 1: These are dApps that dispose of their blockchain. Additionally, they have their infrastructure without dependence on another network for proper performance.

● Level 2: These are all dApps that depend on a third-party blockchain network. They create their own tokens or use the network's available tokens.

● Level 3: These dApps do not have their blockchain network or their tokens, so they are forced to use the entire infrastructure of Level 2 dApps to perform their operations.

What To Expect In The Future

The popularity of blockchain technology has experienced high growth in recent times. As a result, more and more people and companies have become interested in its development and applications.

New jobs will likely be required as more companies adopt blockchain technology and dApps continue to develop. On the other hand, as more people adapt and become more comfortable using these applications, the way the business may be done today will change.

Governments will become increasingly interested in blockchain technology, changing how they share and obtain sensitive information.

Although dApps have great potential to become an essential technology, we should also note that Decentralized Applications are still in the early stages of development. Hence, the industry still has to solve problems such as scalability, interoperability, and code modifications. However, as more updates become available, these issues are expected to be overcome.

The traditional app development process is already well known, and here the dApps emerge as a new package of market challenges and opportunities both for users and developers. Thanks to the security provided by this technology and the use of cryptocurrencies, it is the ideal scenario for markets and services that need a strong protection level, such as healthcare and financial services. Moreover, blockchain services are completely secure, and once data is entered into the system, it can't be deleted or modified. This could be well appreciated by users, especially in regards to Apps and platforms that could use an upgrade in regards to data security issues.

Food For Thoughts

Nowadays, emerging technological solutions are giving users the possibility to experience different forms of interaction , and much more secure and efficient solutions. We will continue to see how blockchain apps will gradually develop and continue to exploit its potential throughout the world.

That is why, if you are ready to make the most of dApps, we invite you to contact Rather Labs, a team with all the experience and willingness to make your venture into blockchain technology a reality in the most successful way.

Meet the author

Carlos Sereno
Marketing @ Rather Labs
Journalist, copywriter and a lover of the world of cryptocurrencies and blockchain technology.
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