What are dApps? Everything You Need to Know
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dApps, short for decentralized applications, are software that run on blockchain technology. Quite often, you hear the term “decentralized” being used to describe, well, pretty much everything, when working with crypto. It simply stands for the lack of a central authority.
That’s the concept of blockchain at its core, but as technology continues to advance, we’ll eventually need more than a network and a handful of nodes.
Decentralized applications add more to this picture. If blockchain was the foundation of a decentralized ecosystem, dApps would be the construction materials. They connect users with specific needs with the appropriate platforms on Web3. With dApps, developers can build entire networks in all possible niches, catering to the most nuanced of requests.
How do dApps work?
Unlike traditional applications, which rely on a central authority (often called the server), dApps operate on a distributed network of computers, a.k.a the blockchain.
While there are many blockchains that run dApps, a majority of them are Ethereum-based. If you happen to come across a dApp that’s been hyped up in the community, it likely belongs on Ethereum.
But some dApps can act as an entire blockchain. For example, Bitcoin is considered a decentralized application. dApps built on top of the blockchain are Layer 2 applications. They operate on smart contracts and transactions made within the app are recorded on the blockchain as a public ledger. Fundamentally, dApps are designed for peer-to-peer interactions and there can never be a third-party intervention.
To use a dApp, users often need to purchase or earn its utility token. You can earn tokens by contributing to the networks through mining or staking.
Depending on the nature of the application, you can use its tokens to gain access to services or, if it’s a gaming dApp, exclusive content or items. Every dApp should specify the token required to use it. For example, Alien Worlds, a super popular app, runs on Trilium (TLM) and you can get a hundred of them for a little over one US dollar.
Why use dApps?
Besides the obvious reason that decentralization is hip, dApps offer a wide variety of benefits, including having full control over your own data.
Since there’s no centralized server, users of dApps retain autonomy over their data and transactions. This provides an additional layer of online privacy, a rare feature in today’s internet climate.
Another benefit of dApps is security. Traditional applications are more vulnerable to attacks as there is a single point of failure. You often see this flaw in the form of DDOS attacks, especially on gaming servers, or data breaches.
dApp networks are resistant to such attacks due to the distributed control among participants. This also means that downtimes, i.e server crashes, are pretty much nonexistent for a decentralized application.
If you already know which dApp to start using, simply head to its page, but make sure you have the necessary tokens or prepare to obtain them. Otherwise, here are some of the popular dApps to try:
OpenSea – an NFT market platform, offering numerous collections from nearly free to the price of your house.
PancakeSwap – a decentralized exchange specialized in trading, yield farming and NFT collectibles.
Splinterlands – a digital web3-powered card game that lets users collect and trade rare cards and other items.
NBA Top Shot – forget physical basketball cards, you can now trade digital NBA cards on the blockchain. You can also collect top shot moments captured in the form of NFTs.
Connect your dApps to Atato Custody
There are lots of things we’re still learning about dApps, but one thing we know for sure is that they’re here to stay.
Atato utilizes this reality by allowing our users to interact with their dApps through Atato Custody. Freely and easily set rules and policies for any dApp in your Atato workspace, such as approvers for transactions.
You can also connect your Atato wallets to dApps via WalletConnect, one of our highly anticipated features that will become available for all Atato users.