dApp – you’ve probably heard that word so many times. Normally they talk about dApps in the context of Ethereum: no middlemen charging fees for their services but gas fees, open-source protocols, public data records and, yes, blockchains changing financial paradigms. So, what’s a dApp?
In short, dApp, decentralized app, is a censorship-resistant, blockchain-based, open-source app that can help you track assets as they move around the globe and enable financial transactions without such centralized authorities as banks. Also, in light of this summer’s DeFi boom, dApps comprise a whole ecosystem for borrowing/lending, monetary banking, staking and trading built mostly on top of Ethereum and sometimes other blockchains such as TRON or EOS – but mostly on Ethereum.
From the very beginning, Vitalik Buterin’s intention was to create a protocol with the emphasis on security and scaling as well as libertarian values, such as independence from old financial institutions.
After some time, the platform turned into a network with its own rules and philosophical values. For example, all the dApps that are built with Ethereum-native programming language Solidity are woven together on a technical level, and every developer can fork your code, every person can participate.
Here are some examples of dApps you might have heard about.
Maker Protocol, MKR token
MakerDAO is a dApp that helps users borrow and save money. It is also a basis for a stablecoin Dai users can get by locking some Ether in the platform. Want to get more Dai? Lock up more Ether on top of MakerDao.
As of writing, MKR is traded for $508.84.
Chainlink, LINK token
The Chainlink protocol was created by a Russian developer Sergey Nazarov once he realized how the blockchain world needed an additional layer to communicate with well-established businesses. He came up with an idea to create a network of oracles that would transmit data from regular servers to the blockchain network. As the developers put it, the oracles provide external data (e.g. temperature, weather) that trigger smart contract executions upon the fulfillment of predefined conditions.
As of writing, LINK is traded for $11.59.
Uniswap, UNI token
Uniswap is a platform for DeFi tokens where you can earn rewards for providing liquidity to token pools.
Say, you add a pair to an exchange’s pool, and this pair takes up 5% of the whole pool. When somebody swaps the provided tokens, and the pool will receive the fee, you’ll get 5% of the whole fee. Sounds nice, right?
That’s why, as of writing, UNI is traded for $2.98, although it saw the light for the first time a few months ago.