Why The Future is Bright: Investigation Into Decentralized Applications (Dapps)
What is a dapp?
DApp is an abbreviated form for decentralized application.
A DApp has its backend code running on a decentralized peer-to-peer network. Contrast this with an app where the backend code is running on centralized servers. Noticeable common features of Dapps:
Open Source. Ideally, it should be governed by multiple users. Its code base should be available for scrutiny.
Decentralized. All records of the application’s operation must be stored on a public and decentralized blockchain.
Incentivized. Validators of the blockchain should be incentivized by rewarding them accordingly with cryptographic tokens.
Protocol. The application community must agree on a cryptographic algorithm to show proof of value. For example PoW or PoS
While the cryptocurrency has been around for around 10 years the concept of dapps is still fairly new with the initial releases of the dapps coming only in 2017 meaning it is still extremely new concept.
The difference between early blockchains like Bitcoin and 2.0 blockchains like Ethereum are smart contracts – those allow dapps to me produced because they add conditions to transactions.
Ethereum is currently dominating the dapp market. More and more dapps are also starting to appear on NEO and EOS is the third project that starting.
It is expected that more blockchain projects will start to have dapps running on them since there are plenty of smart contract platforms.
There are several dapps already live and operational. The most popular dapps are decentralised exchanges:
IDEX, ForkDelta, Bancor and LocalEthereum all being in top 10. Other operational decentralised exchanges include Kyber and AirSwap.
Gambling apps are also popular:
Fomo3D, PoWH 3D, Etheroll. Other operational dapps include Funfair, vDice and Edgless
There are also few simple games/collectibles with Cryptokitties being the most popular one, there are also the likes: Gods Unchained, MegaCryptoPolis and CryptoCountries
Augur is the most unusual popular dapp – it’s a prediction application.
Augur is the only non exchange/collectible/gambling ICO that has delivered the promises so far and actually provides a decentralised product that is somewhat unique.
This means that there are still hundres of unique ICO that are currently developing their decentralised dapps and hopefully will soon start delivering promises.
This an extremely bullish sign for platofrms like Ethereum and NEO (since those dapps will burn tokens as fees) as well as for cryptocurrencies that are tied to those dapps.
Most of those dapps will not find users but few should become popular platforms around the world.
Currently there are barely any users/usage for dapps.
Main exchanges, Augur and some of the gambling projects are the only one generating reasonable volume and number of users and even those are relatively low as visible. IDEX had a volume of $1.4M. Augur 466k.
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