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Decentralized Applications Development

DeFi is financial instruments in the form of services and applications built on the blockchain. The main goal of decentralized finance is to become an alternative to the banking sector and replace the traditional technologies of the current financial system with open-source protocols. That is open access to decentralized lending and new investment platforms for a large number of people. And allow them to receive passive income from cryptocurrency assets and save on fees for transfers, loans, and deposits.

Most of the existing DeFi is built on the Ethereum blockchain, and the number of new applications in decentralized finance is growing steadily. So, in early February, the number of Ethereum blocked on intelligent contracts for DeFi applications reached $87B as of May 2021, according to the Defipulse portal.

Why dApps are needed, and how do they differ from non-decentralized applications?
Decentralized applications are based on blockchain technology. They are open-sourced and attack-resistant. Decentralized applications are similar to smart contracts on the Ethereum blockchain, but they also have key differences. Unlike smart contracts, dApps are not tied to financial transactions and can use blockchain to achieve any goal.

Decentralized applications have become an alternative to many familiar services. What is the essence of such an application — is it necessary and useful, or is it just a tribute to fashion?

What are dApps?

So what are the distinctive properties of dApp-applications if you compare them with ordinary ones? And what is an "application" in general? Most often, this word is used to refer to a program on a smartphone. Probably, it is ordinary (decentralized), because it is used by a large number of people at the same time. However, this is not entirely true.

Speaking of a decentralized application, we mean the structure of its work and external design. DApps are pretty well protected from any intrusion. But at the same time, there is the possibility of access for verification.

Many associate a dApp application exclusively with cryptocurrency. However, the concept of "dApp" appeared much earlier. These applications include torrents, which are also considered the first decentralized applications because there is no regulatory body, and all participants have the same rights.

What is the uniqueness of cryptocurrency-based dApps?

Blockchain companies are not the founders of dApps, but blockchain has taken the first steps and further development. It is pretty easy to create a decentralized application, and it will not cost so much.

Programmers do not have to re-create the structure; they adapt ready-made properties to their requirements. This makes the program easier, and the development time is reduced several times. Therefore, most dApps users are starting to use cryptocurrency apps and tokens.

Everything seems to be fine. But caution will not hurt. The main thing is not to fall for the bait of marketers.

Regular application or dApp — which is better?

Programmers use the word "decentralized" to attract as many users as possible. Not all applications that refer to themselves as dApps are.

One of the characteristics of such an application is the availability of validation. The command referring to the private source is not a dApp, but a regular application. Therefore, you need to be able to distinguish ordinary applications from decentralized ones. Learning to distinguish bootstrapping from outsourced validation is vital.

You can consider this using the example of torrents. For example, downloading a file that has been signed as a program can result in a virus. But it is impossible to insure against this if you do not use exclusively trusted sources.

What is an Outsourced Decentralized Application?

dApps have a single entry point, but the initial cipher can be the same as the boolean check. People don't test the functionality of an app before using it.

Why a third party for a decentralized application? This is done for the user's peace of mind and safety, to hold them accountable in the event of hacker attacks, and the elimination of virus files. Well, there is a risk here, as a third party can use your data.

But most applications are created with the involvement of third parties since people, due to the lack of specific knowledge, cannot control their actions and monitor their safety. Only proven and proven developers can reassure their consumers. Therefore, only the applications of such developers will be used by people without thinking about their safety.

If you are interested in developing defi applications, contact us. We have a wide portfolio and experience in the field of blockchain and financial applications.