A DApp, short for Decentralized Application, is a type of software application that runs on a decentralized network, such as the blockchain, rather than on a centralized server. DApps are designed to be transparent, immutable and decentralized, meaning they are not controlled by a single entity or individual. Instead, they are built on a decentralized network that allows multiple users to participate, making them more resistant to censorship and manipulation, due to decentralization.
DApps use smart contracts, which are computer programs that automatically execute when certain conditions are met, to perform their functions. These contracts are executed on the blockchain and can be viewed by all network participants. Examples of DApps include decentralized finance applications (DeFi), decentralized online games, decentralized file storage platforms, among others. In short, DApps offer a decentralized alternative to traditional centralized applications, making them more secure, transparent and resistant to censorship.
To achieve a decentralized application, several aspects need to be considered, such as storage, communication and computational power. In this answer, we will focus on analyzing the importance of storage in a decentralized application and the options available to achieve secure, decentralized and scalable storage.
Storage
Storage is one of the fundamental components in the development of decentralized applications (Dapps). In a Dapp, storage must meet certain requirements, such as high accessibility and link stability, to ensure proper operation and a satisfactory user experience. In this section, we will explore the different storage methods available for Dapps, their pros and cons, and how they fit the storage requirements of a decentralized application.
Direct storage on the blockchain
In direct storage on the blockchain, all the information of the decentralized application is stored on the blockchain. This means that all nodes in the decentralized network have a complete and up-to-date copy of all application information.
A major advantage of this approach is the complete decentralization of the information, which means that there is no single entity controlling the application information. In addition, the information is secure and tamper-resistant, since any attempt to modify or delete it would require the consensus of the majority of the nodes in the network, making it virtually impossible.
However, direct storage on the blockchain has a fundamental limitation: scalability. Because all nodes must store all application information, this can result in too heavy a load for nodes with lower capacity or bandwidth. Therefore, it is difficult to store large amounts of data, such as images or large blocks of data, on the blockchain.
Distributed Hash Tables (DHT)
In Distributed Hash Tables (DHT), blocks of information are associated with a hash that is stored in the cloud. The actual content of the information is not stored in the cloud, but is stored locally on each node.
The advantage of this approach is that the information is stored in a decentralized manner, meaning that there is no central entity controlling it, but unlike direct storage on the blockchain, not every node in the network needs to store all the information. Instead, each node only needs to store the information that relates to the hashes that are assigned to it. This makes the DHT scalable, as a large amount of data can be stored in the cloud without burdening the network of nodes.
However, DHT also has an important limitation: availability. To access the information stored in the DHT, the node that has the information associated with the corresponding hash needs to be online and connected to the network. If that node goes offline, that information is lost and is no longer available to the network.
In summary, both direct storage on the blockchain and DHTs have their advantages and limitations. Direct storage on the blockchain is secure and tamper-resistant, but it is difficult to scale for large amounts of data. DHTs are scalable and can store large amounts of data without burdening the network of nodes, but the availability of the information depends on the connectivity of the nodes storing it.
Communication
Communication is a key component in any decentralized system, and Dapps are no exception. Unlike centralized systems, Dapps do not have a central server that acts as an intermediary for communication between users. Instead, Dapps use different approaches to establish efficient communication between network nodes.
As mentioned earlier, the Internet is not decentralized, and most online communication relies on Internet Service Providers (ISPs) acting as intermediaries. This implies that if an ISP goes down for any reason, communication with the outside world becomes impossible. Therefore, Dapps are looking for alternative solutions to establish reliable and uninterrupted communication between network nodes.
One of the alternatives to ISP-based communication is the use of mesh networks. These networks are based on wireless connection between devices, and do not require Internet connectivity to function. This means that devices can connect directly to each other, without the need to go through a central intermediary. Nodes in a mesh network can send and receive information directly to each other, ensuring that communication is not interrupted even if some nodes in the network fail.
Another alternative for communication in Dapps is the use of peer-to-peer (P2P) protocols. In these systems, each network node acts as both client and server at the same time, allowing direct communication between them. This means that information can be shared between network nodes without the need to go through a central server. In addition, P2P protocols can be used in different types of networks, which makes them very flexible.
In summary, communication in Dapps is essential for their operation and requires alternative solutions to centralized ISP-based systems. Mesh networks and P2P protocols are two very promising alternatives to establish efficient and seamless communication between network nodes.
Important Decentralization Concepts
Smart Contracts
Smart Contracts are computer programs that run on a blockchain and whose function is to automate the execution of certain business logics. These contracts are based on a series of preset rules and conditions that, when met, trigger the execution of the contract. Unlike traditional contracts, Smart Contracts are autonomous and do not require intermediaries for their execution, thus reducing costs and increasing security and transparency in transactions.
Smart Contracts can be used in different applications, from financial transaction management and asset tracking to supply chain process automation and digital identity verification. In addition, these contracts can be programmed to execute automatically and without human intervention, reducing the possibility of errors and increasing efficiency.
Autonomous Agents (AA)
Autonomous Agents (AA) are software entities that act autonomously according to their owner’s interests, without the owner’s intervention. These agents may or may not include artificial intelligence and can be programmed to perform a variety of tasks, such as asset management, contract negotiation, risk management, decision making and problem solving.
Autonomous Agents can be used in a variety of applications, from investment portfolio management to supply chain process automation and energy grid management. In addition, these agents can be programmed to adapt to different situations and conditions, allowing them to make decisions autonomously and reduce the need for human intervention.
Decentralized Organizations (DO)
Decentralized Organizations (DOs) are computer programs running on the blockchain that are designed to mimic the structure and functioning of a real organization. These organizations are composed of one or more Smart Contracts and allow different parties to interact with each other autonomously and without the need for intermediaries.
ODs allow the creation of more flexible and decentralized organizational structures, thus reducing costs, increasing transparency and efficiency in decision making. Furthermore, ODs can be used in different applications, from collaborative project management to the creation of crowdfunding platforms and the management of energy networks.
Decentralized Autonomous Organizations (DAO)
Decentralized Autonomous Organizations, or DAOs for short, are blockchain-based programs that enable the automation of an organization’s processes, without the need for human intervention. But what differentiates them from Decentralized Organizations (DOs)? The main characteristic of DAOs is that they have Artificial Intelligence (AI) that allows them to act independently and autonomously, making decisions and executing actions without the need for human intervention.
One of the main applications of DAOs is the implementation and automation of the operation of real companies or organizations on the blockchain. In addition, DAOs offer an innovative way of organization and decision making, allowing participation and voting by anyone around the world, regardless of their geographic location. On Ethereum, the most widely used blockchain platform for the creation of DAOs, several charities, investment funds and collaborative projects have been created that operate under this decentralized and autonomous model.
On the other hand, within DAOs there are Decentralized Autonomous Companies (DACs), which aim to obtain economic benefits through the implementation of a real business. These differ from the rest of the DAOs, which are generally considered non-profit.
Another concept that falls into the realm of decentralized, autonomous organizations is Decentralized Autonomous Societies (DASes), which allow an entire society to operate on a blockchain. These use a combination of DAOs and decentralized applications (DApps) that run autonomously and are controlled by multiple complex smart contracts.
It is important to note that, currently, DAOs have no recognized legal status in the real world, although they may have some smart code that enforces certain protocols and conditions. However, the concept of DAOs and their real-world application continues to evolve and explore new possibilities, such as Algocracy, an alternative form of governance and social system where computer algorithms maintain, control and automate public services such as law, the legal system, regulation, governance, economics, policy and public decision-making.
Decentralized Applications (DApp)
Decentralized Applications (DApps) are a type of application that uses blockchain technology for its operation. These applications are different from traditional applications in terms of their architecture, as they do not rely on a centralized server for their operation. Instead, DApps are applications that run on a network of decentralized nodes on the blockchain.
DApps fall into three main categories. The first type of DApp is one that has its own blockchain network dedicated to it. This type of DApp uses its own native cryptocurrency or token. Bitcoin and Ethereum are examples of DApps of this type. The second type of DApp uses an already established blockchain and makes use of custom protocols and tokens. For example, DAI is a DApp running on the Ethereum platform, and OMNI is a DApp running on Bitcoin. Finally, the third type of DApp makes use of both the blockchain network and the protocols of an established type 2 application. An example of this is the SAFE network, which uses the OMNI network protocol.
DApps have many advantages over traditional applications. First, DApps are more secure because they do not have a centralized point of failure. In addition, transactions made on a DApp are immutable and verifiable, meaning that they cannot be modified once they have been recorded on the blockchain. They are also more transparent as the information is stored publicly on the blockchain and is accessible to anyone who wishes to verify it.
The criteria for an application to be considered a DApp are critical to ensure that it is a truly decentralized and secure application. Each of the criteria is explained in more detail below:
- Total decentralization: The application must be completely decentralized and not depend on any centralized entity or central server for its operation. All transactions and operations are performed on the blockchain network, which is a distributed and decentralized network. This ensures immutability of data and resistance to censorship.
- Open-source: The source code of the application must be open and accessible so that anyone can review and audit it. This allows the community to detect and fix any security issues or vulnerabilities.
Cryptographically secure: The application must ensure the security of the data stored on the blockchain. The blockchain is inherently secure, but it is important that the application implements good security practices, such as data encryption and user authentication. - Incentivize availability: The application should reward users for their participation in the network. This can be achieved by creating tokens that can be used within the application or exchanged for other cryptocurrencies. Users who contribute to the network should be rewarded to incentivize their continued participation.
- Proof of value: tokens that are generated in the application should be generated in a decentralized manner using a consensus algorithm. This ensures that there is no centralized entity controlling the issuance of tokens and that the amount of tokens generated is based on the users’ contribution to the network.
The differences between a traditional application and a decentralized application (DApp) are not only limited to their design architecture, but also involve changes in the way they work and the user experience. The most important differences in design are detailed here:
– Architecture: Traditional applications typically have a server-client architecture, where users connect to a centralized server to access the application’s data and functions. In contrast, DApps are based on a peer-to-peer (P2P) architecture, where users interact directly with the blockchain and the smart contracts it hosts. This means that there is no centralized server, which makes DApps more resilient to failures and cyberattacks.
– Access: In a traditional application, the user needs to have a user account and password to access the application. In DApps, access to the platform is through private keys, which are the only way to access smart contracts and information stored on the blockchain. The user is the sole owner of his private keys, which increases the security of the platform.
– Interaction: In traditional applications, users interact with the application through a graphical user interface (GUI) and send requests to the centralized server. In DApps, users interact with the blockchain and smart contracts through a GUI, which communicates with the blockchain through an API. This means that the application is operating system independent and can run on any platform, which facilitates access and interoperability.
– Storage: In a traditional application, data is stored in a centralized database, which is managed by the centralized server. In DApps, data is stored in the blockchain, which is a decentralized and replicated database. This means that the data is available to any user of the blockchain, but can only be modified by network consensus.
– Tokens: DApps often have their own digital currency or token, which is used to access the application’s services and functions. These tokens can be acquired through cryptocurrency exchanges or by participating in the app’s network. In contrast, traditional apps do not usually have their own currency, as transactions are carried out through traditional means of payment.
Innovative trends
Innovative trends in the blockchain world are increasingly varied and constantly evolving. From the creation of decentralized applications (DApps) to the adoption of technologies such as decentralized identity and decentralized economy, blockchain is becoming a disruptive force in multiple domains. Here, we’ll delve into three innovative trends that are transforming the way we interact on the web, verify our identities and manage our finances. Discover how the decentralized web, decentralized identity and decentralized economy are changing the world.
Decentralized Web
The decentralized web is a vision of the internet in which there is no central authority to control and regulate access to and use of information. Instead, it seeks to make the web a distributed network in which each user has control over their own personal information and data. Blockchain technology is a key element in this vision, as it allows the creation of a decentralized network in which data is stored securely and cannot be manipulated without the user’s consent.
The concept of Web 3.0 arises with the aim of developing a decentralized web in which control over information and personal data is owned by the users. This implies greater privacy, security and freedom on the web. Some of the technologies being used to make this vision a reality are cryptography, blockchain and smart contracts.
Decentralized identity
Decentralized identity is an innovative trend that uses blockchain technology to support and ensure the veracity of users’ identities. Instead of relying on a centralized entity to verify users’ identities, blockchain is used to create a single, immutable digital identity that can be verified by any entity without the need for a central authority.
One of the advantages of decentralized identity is that it allows users to have greater control over their own personal information. The digital identity is owned by the user and cannot be manipulated without their consent. In addition, decentralized identity has the potential to reduce users’ reliance on third parties to verify their identity, which can improve online security and privacy. Atonomi is an example of a decentralized identity platform that uses blockchain technology to ensure the security and privacy of user information. Atonomi uses the Ethereum blockchain to create a single, verifiable digital identity that can be used across multiple online applications and services.
Decentralized economy
The decentralized economy is an innovative trend that seeks to transform the way money and financial services are handled, eliminating the need for intermediaries and creating a fairer and more accessible system for everyone. Instead of relying on banks and other centralized financial institutions, the decentralized economy uses blockchain technology to create a decentralized network in which users can send and receive money directly to each other, without the need for intermediaries.
Blockchain technology enables the creation of cryptocurrencies and tokens that can be used as forms of payment in the decentralized economy. These tokens can be exchanged directly between users and can be used in multiple applications and services. The decentralized economy has the potential to democratize access to financial services, reduce transaction costs and improve financial inclusion for people who currently do not have access to traditional banking services. Examples of projects that are working on the decentralized economy include Ethereum, MakerDAO and Uniswap.
