dApp is a decentralized application built using smart contracts on the blockchain. dApps were originally made possible by the Ethereum network but now other smart contracts supporting networks like Cardano, Solana, Polygon, and others have further popularized their development. 

dApps are the software that interacts with the blockchain. Their interface or frontend is not different from the conventional software. The average user won’t be able to tell whether an app is decentralized or not. The major difference is that no central authority or corporation controls the dApps. All the data on a dApp is completely under the user’s control.

The main features of a dApp are:

• Open Source – The source code is available to everybody for verification, use or even copy to make their own dApp. 
• Cryptographic Immutability – All data is stored on the blockchain in a permanent form. This means that once the data has been written on the blockchain by dApp, it cannot be altered in any way.
• Decentralized – DApps are not controlled by any single entity. They function on the network consisting of several nodes or users built using the blockchain.

How dApps Work?

The dApps are made up of a front-end and a back-end. The back-end is the complex part. It utilizes smart contracts to communicate with the blockchain and is usually programmed using a special programming language. 

Now let’s see an example of a payment receiving dApp. This app receives the payments, verifies it and then sends a confirmation message to a website all coded inside a single smart contract.

First off, the smart contract will check the user account with public and private keys and verify the required amount. Then the amount will be transferred from the user’s wallet by the smart contract which will then validate that it has been received.

In the next step, the smart contract will write the transactional details on the blockchain.

Lastly, the smart contract would send a payment confirmation message to the website which the user will see.

This concept of dApps built upon smart contracts can be applied to almost any other field be it health care, entertainment, law etc.

The next version of the internet called Web3 is also being built using the dApps. This new internet built using the blockchain is going to be censor-free with users having complete control over their data. As the dApp ecosystem solves more use cases, the growth is only going to get faster. 

If you are interested in knowing more about Web3 and the decentralized internet, then check out this explainer or our podcast on this topic here.

Suleman Arshad

Suleman is a part-time crypto writer and full-time book addict. He holds a master’s degree in Chemical Engineering. Nothing excites Suleman like a well-organized fundamental analysis for long-term investment.