One of the key traits that cryptocurrency is known for is its decentralized nature, meaning that it isn’t controlled by a single entity such as a bank or any other financial institution. This allows people who participate in the crypto market to do so without having to pay steep intermediary fees or share their personal information to a conventional monitoring entity, thus promoting better control and privacy over their finances. And if you’re exchanging Monero (XMR) coins through your XMR wallet, a privacy coin like this one will allow you to transact anonymously without having your name or other details attached.
It then comes as no surprise that this decentralized nature has figured into other crypto-adjacent applications, one type of which is dApps or decentralized apps. dApps comprise software that runs on blockchain or peer-to-peer (P2P) networks. Actions done in a dApp are recorded on a public blockchain network, so that no single company has control over user data. Instead, an app’s functionality is maintained through a smart contract, or a self-executing program that does its assigned job so long as required conditions are met.
There is still more to dApps than meets the eye, however. Here’s a quick guide on the advantages of using dApps and their emergent applications.
The Benefits of Using dApps
You may be wondering about what you could stand to gain by exploring and using the dApps currently available in the market. The answer lies in what you value as a user. While you can indeed just use any company-owned app, there are certain benefits that you can only obtain through dApps, some of which are the following:
1) Added Privacy Over Transactions
If you’re the type of user who values your anonymity when making online transactions, dApps may be able to offer you that added privacy. For traditional apps run by a single entity such as a social media app, you usually turn over your personal data as part of the sign-up process. That means that even if you don’t use your real name on your profile, the company still knows the personal email or phone number that you used to sign up for the account.
Meanwhile, with a dApp, you don’t need to provide such details. Simply signing in with your crypto wallet will do. And given that your crypto wallet is private already, you can expect that login to be just as private as well.
2) Transparency
Transactions made through dApps are recorded on the blockchain and thus cannot be deleted or modified. This promotes transparency as it allows users to easily verify and audit their transactions through the public blockchain. If you complete a transaction through a dApp, then that will be recorded without any means to tamper with it, making it less vulnerable to fraud or falsification.
Similarly, dApps are also more resistant to censorship. An app controlled by a single company can choose to change its terms and execute its own form of censorship if the company so wishes. This is less likely to happen in a dApp as there’s no single entity that can delete transactions already recorded in the blockchain.
3) Cost-Efficiency
Given that there is no single company that owns a dApp, these apps can also run at reduced costs. This means less fees to be shouldered by the user. When you transact with a bank, for example, you’ll need to pay fees for the staff to facilitate your transaction. Conversely, transacting through a dApp nets lower or even zero fees at all considering that an intermediary is no longer needed—the transaction is directly between you and the recipient only.
4) Less Vulnerable to Cyberattacks
Because of its decentralized nature, it’s less likely for cyberattacks to bring down an entire dApp as there isn’t a single server that can be targeted. Meanwhile, a traditional app with a centralized server could easily go down should that server be attacked if it handles the operations of the entire application.
5) Encourages Collaboration
dApps are open source, meaning that the code used to build a dApp is available for other users to view. This then encourages collaboration in order to build upon a dApp’s existing functions, allowing the community itself to use their experience to improve an app they’re all using.
Emerging Uses and Applications for dApps
Due to their open-source nature and versatility, dApps are open for various applications. Your go-to crypto wallet, for example, may be considered a type of dApp in itself.
But dApps are also being used to explore more than just finances. Some examples are games that allow you to win crypto and thus earn while you play and fan engagement apps that give fans exclusive voting privileges about decisions made by their favorite sports teams, the latter through the use of fan tokens that can be purchased in the app. Such applications take advantage of the features found in dApps to provide their users with singular experiences.
The dApps market is still growing, and future dApps certainly have the potential to bring about a major change in the way we interact with various online sectors. Sooner than we think, there may come a day when dApps become just as popular as traditional apps—and that day may be celebrated because it allows a wealth of options for essential and day-to-day online activities.
