Learn to use a powerful, fast, and easy language to build dApps on Cardano.
One of the most important innovations from blockchain technology has been the decentralized application or dApp.
It created a new way to provide accessible products and services through the usage of programmable smart contracts. These smart contracts automatically self-execute once certain conditions are met and can record necessary changes and information as needed on a shared blockchain ledger.
This meant that anyone with an Internet connection could access services without having to request permission from a centralized entity or third party.
In a traditional centralized application, there is typically a backend (a server) that contains the detailed logic of the service.
For example, suppose a particular app provides a service that sells video games. In that case, various aspects such as the gaming catalog, account information, product prices, and other relevant details are controlled by the backend.
However, any problem with the backend could potentially result in a loss for end users. This could include preventing user access to app services that have been paid for, losing valuable user information, etc. Furthermore, those controlling the app can deny anyone access without recourse from the user.
Applications using this type of client-server architecture are the norm today. Most popular apps have a centralized design that enables the app developer or entity to have permission to provide access to its users.
But this begs the question: What if we could flip this structure and do it another way?
This blog will explore this question further and discuss Aiken, a potential solution for developers that enables a faster and simpler dApp development process.
What is a dApp?
A dApp aims to flip the centralized app structure by handing power to the end users.
It takes the business logic of an app service and uses a distributed ledger or blockchain network to process its operations.
They utilize an underlying blockchain platform that is open-source and decentralized with immutable and programmable smart contracts, thereby offering more transparency and accessibility. Transactions could be verified by anyone, relevant information could be looked up by anyone, and there wouldn’t be any sort of gatekeeper to manage user access.
Due to these compelling benefits that confer more control and access to users directly, dApps have become one of the main first use cases of decentralized blockchains.
Most early adopters of dApps use them to access services that were previously difficult or inaccessible due to various reasons.
Some examples of dApp services include:
- Borrowing & Lending Marketplaces: These allow users to lend and borrow cryptocurrencies including stablecoins, providing access to a form of financial services. All the logic of interest rates, payments, and collateral is controlled by smart contracts without any centralized intervention.
- NFT Platforms and Marketplaces: NFTs (non-fungible tokens) are unique digital assets created on the blockchain that represent ownership of a specific item, like art or music. NFT marketplaces allow users to list and resell their NFTs. They provide an open market for price discovery to anyone looking to sell an NFT. In some cases, these platforms also allow users the power to launch new NFTs without having to code and could enable the freer trading of such tokenized assets.
- Synthetic Assets: These allow a user to create an asset token that simulates the price action of another asset. A user can lock a designated cryptocurrency in a smart contract and receive a synthetic dollar that tracks the price market of the original currency, providing potential access to those unable to access markets.
In every example above, the logic is executed on top of a decentralized blockchain. There is no need for human intervention once the smart contract and the UI/UX of a dApp are developed. This means they can be more cost-effective to develop and operate than traditional applications.
This makes dApps have a greater global reach, more transparency, and more efficiency from a cost perspective. They are also censorship-resistant, meaning a centralized entity can’t manipulate information or prevent access to certain users.
