When we look at what mainstream media is covering in the cryptocurrency space, more likely than not, it will be about Bitcoin hitting an all-time high, or the revolutionary potential of blockchain technology. As a crypto-enthusiast I find this encouraging, because it indicates to me that cryptocurrency and blockchain technology is becoming more mainstream. However, often left out of the crypto-news cycle are decentralized applications (DApps) and their promising future within the cryptocurrency ecosystem. Despite being somewhat underappreciated currently by the media, I predict that the subject matter of DApps will become increasingly important in taking the crypto-space to the mainstream.
What Are DApps?
At their core, DApps are software programs that use the power of blockchain technology and smart contracts to achieve application decentralization, this means that control over any DApp cannot be exercised by any single entity. For example, on a decentralized Facebook or Youtube like platform, once a post or video is made it would be censorship resistant, as the blockchain itself is immutable. Smart contracts are self-executing contracts that are designed to enforce an agreement created between two parties. Smart contracts are fashioned to facilitate the exchange of money, or anything of value, meaning that they can be used to create whole ecosystems of value exchange within a DApp, making the use case of DApps even more extensive.
You can really see the importance of DApps when you understand the problem they are trying to address, that problem being control over one’s data. When you use the Facebook application, you are liking, commenting and generally interacting with others on the platform. When you do this however, you are giving data to Facebook. In turn, Facebook is storing that data and selling it to advertisers so that they can tailor their ads to suit your preferences. For many, it is an uncomfortable feeling to have their data treated in this manner, ideally, your data should remain your own. DApps give users back control over their data, by ensuring that no single entity is in charge of any user’s data.
For an application to be truly decentralized it usually must meet the following requirements:
Open Source: The application’s code base must be widely available so as to allow for public scrutiny.
Decentralized: The application’s data must be cryptographically stored on a public and decentralized blockchain.
Incentive: The application must utilize tokens/digital assets to reward its network supporters.
Protocol: The application must generate tokens using a cryptographic consensus algorithm to demonstrate proof of value e.g. proof of work or proof of stake.
DApps on the Ethereum Blockchain
The Ethereum blockchain is the most well-developed network for facilitating the creation of DApps. Using its very own programming language, Solidity, developers can build DApps on just about anything. The DApps that have been produced so far speaks volumes to where this part of the ecosystem can take us.
Golem: Golem is an open sourced, decentralized supercomputer that anyone can access. The computational power of Golem comes from the combined power of users’ machines, from personal computers to whole data centers. The most impressive aspect of the Golem project for me is its decentralized sharing economy of computing power. Using Golem, users will be able to rent out their computing power. So, if you have spare computing power on your personal device, you could earn money by renting it out.
EtherTweet: Ethertweet is a decentralized blogging platform that provides functionalities similar to Twitter. However, being a DApp, EtherTweet takes advantage of the immutable blockchain to produce an uncensored blockchain-based social platform.
Although these are just a few DApps that this article mentions, there are many other DApps that have the potential to take cryptocurrency mainstream. To mention just a few: Augur, TenX are all interesting DApps to follow. The cryptocurrency space has seen extensive media coverage this year in primarily Bitcoin’s tremendous market gains. However, I believe that media dialogue will start to shift from the likes of Bitcoin, to DApps. A lot of DApps are still in their developmental stage, which explains why media coverage has been subdued. The space has not really produced a killer DApp that penetrates beyond the realm of simply crypto. But, it is likely that this will change with the passage of time. As existing developers improve and streamline their DApps, or as truly astounding DApps hit the market, surely then will the value of DApps be reflected in more extensive, mainstream media coverage.
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