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If you’re new to crypto, you’ve probably heard the term dApp many times already. But what exactly is a dApp, and how is it useful for us? Today, I’m going to share a few insights about it.
dApp is short for Decentralized Application—decentralized applications built on blockchain and supported by Smart Contracts. Simply put, it’s software that runs on a decentralized network instead of a centralized server like traditional applications. Each dApp usually focuses on solving a specific problem.
The great thing here is that a dApp depends on the blockchain it’s built on. The speed, scalability, and stability of the application all depend on the underlying blockchain. Ethereum was where the first dApps emerged, in April 2016, and ever since, the number of them has kept growing without stopping.
When it comes to dApp characteristics, decentralization is the first. No one can control the activities of users on these applications. In addition, most dApps have open-source code, allowing the community to create new projects from existing code. Another important point is that only blockchains that support Smart Contracts can be used to build dApps—so not every blockchain is suitable.
When classified, dApps can be divided by purpose: exchanges, games, finance, gambling, and so on. Or, when divided by blockchain, there are three types: Type I—independent blockchains such as Bitcoin or Ethereum; Type II—protocols that run on Type I with their own tokens; and Type III—protocols that run on Type II, which also have their own tokens.
In terms of practical use, dApps have many directions. Some projects focus on payments and trading, such as Uniswap or PancakeSwap. Others build oracles to bring real-world data into crypto, or develop infrastructure. There are even dApps in the healthcare or charity sectors.
Overall, dApp is a major step forward in blockchain development. Thanks to Smart Contracts, anyone can create decentralized applications to serve personal needs or community needs, opening up huge profit opportunities. The number of dApps will continue to increase because the benefits they bring are clear.