The Rise of DApps: What are they?

Helene Le Roux  London 1/11/18
Fintech Society, King's College London
A new era of scalable and profitable applications (apps) is rising across the world: the DApps.

Based on a similar technology to that of  Blockchain, DApps (Decentralised Applications), in the same way, can’t be shut down nor owned by anyone. 
 
In order to be considered a DApp, it has to meet 4 criteria:
 
1)    It has to have an ALGORITHM that generates tokens and an inbuilt consensus mechanism. 
2)    It has to have an OPEN SOURCE (have its source code available to all)
3)    It has to have INCENTIVE, and thus have crypto-tokens and other digital assets in order to fuel itself.
4)    It has to be DECENTRALISED (use a cryptographic technology)
 
These criteria not only distinguish DApps from other software models, but also make them more flexible, transparent, distributed and resilient. ​

​Not only do they not need to rely on the blockchain network (making them harder to take down), but they also have access to an unlimited number of parties involved on every side of the market.
 
In addition, DApps can be categorised in 3 groups based on the blockchain models they employ:
 
Type 1: These DApps have their own blockchain.
Type 2: These DApps use the blockchain of type 1. They have protocols and tokens needed for their functioning.
Type 3: These types of DApps use the protocols of type II.

Five Giants of the D-App World:

  • FireChat is a peer-to-peer “mesh networking” service allowing for widespread phone communication, without the need for a “network connection” on your phone.
  • Lighthouse is a bitcoin wallet embedded with smart contracts, which help pledge money to certain projects. Ultimately, pledgers can undo pledges at any point, and when the project goals are finished, they can retrieve the funds out of the Lighthouse wallet.
  • Gems connects miners and requesters. It allows anyone to post a micro-task, receive a response, and complete it in order to earn GEM tokens. 
  • Popcorn Time is often referred to as a decentralised version of Netflix. It uses BitTorrent protocol to stream videos between users in real time. It doesn’t need decentralised consensus or internal currency so it doesn’t use blockchain.
  • OpenBazaar is often referred to as the decentralised version of Ebay, but without any restrictions in regards to what can or can’t be sold and at what price. OpenBazaar relies on Bitcoin as a transaction currency and on BitTorrent’s protocol for the data transfer.

It is no secret that Fintech is developing rapidly and that terms such as Smart Contracts, Bitcoin and Cryptocurrencies have already reached the wider public.
We predict DApps to be the next big thing, so make sure to keep an eye on them!
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