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The Need of building decentralized applications – Lets understand DApp

A completely new model for building a successful and scalable application is now evolving as decentralized applications where there is no concept of centralization and as most common model to build an app is based on client and server model which obviously is centralized.

Let’s have a look at three main models and how they differ with each other and why decentralized applications are emerging –

  • Centralized application-

This model is most commonly in action and many engineers are building it up and similarly many users are using, it means centralized applications are very much in use as compare to others and in centralized application data is controlled by a single unit (company) like Facebook, Google, Amazon on which you have to trust that it is being used correctly and in your interest.

  • Distributed application

In distributed applications, computation is mainly done by multiple nodes as opposed to a single one like centralized applications. With the help of distributed application, business operations can be handled from any geographical location.

  • Decentralized Application-

Decentralized applications are also known as DApps are apps whose server-client model are not centralized and not dependent on any single unit and is run by many users on a decentralized network with trustless protocols, they are designed to keep in mind to not have a single point of failure.

Criteria to be decentralized applications:

Any application to be known as DApp, it has to be following attributes:

  • For any applications which have to be decentralized, it is needed to be open source that it must operate autonomously and there is no central point of controlling of its majority of tokens and any changes can only happen by consensus of its users.
  • The application’s data and protocols have to be cryptographically stored in a decentralized blockchain.
  • Cryptographic tokens are needed to have access to application and also used for rewarding network users.
  • Tokens must be generated by a standard cryptographic algorithm that encourages contribution of a member of the network to the system.

Classifications of DApps

The classification of DApp can be done on the basis of if the DApp is using its own blockchain or they use blockchain of another app so we can classify three types of DApp on this criterion-

1: Type I-

Type I decentralized applications use their own blockchain, Bitcoin is the best example of this type of DApps.

2: Type II-

Type II  decentralized applications use blockchain of Type I decentralized applications. Type II decentralized applications are protocols and have tokens for their functioning.  Omni protocol is an example of this kind of DApps.

3: Type III –

Type III  decentralized applications use the protocol of Type II decentralized application and Type III decentralized apps are protocols and have tokens for its function.  An example is a SAFE network which uses Omni protocol.

DApp Mechanisms

There is two common mechanism by which DApp can maintain consensus:

the proof-of-work, POW mechanism and the proof-of-stake, POS mechanism.

With POW, any changes in DApp is approved on the basis of the amount of work that each stakeholder contribute to the operations of DApps.  With POS, any changes in the DApp is approved on the basis of the percentage ownership that various stakeholder have over the application.  Both mechanisms can run parallel as well.

The procedure of creating of your own DApp

You need to follow these steps to build your own DApp-

  • You need to release a whitepaper which can explain all of its features, goals, and mechanism for establishing consensus and also plans for tokenizations.
  • Need to take feedback from your community to make revisions
  • Finalize the date for crowd sale where your community can contribute to crowd-sale.
  • You need to distribute tokens, this will totally dependent on the mechanism you use. Mining will require reference software; fundraising needs a digital wallet for stakeholders and development uses a bounty system for suggestions.
  • Execution of your ideas while you can still develop your plans


Dapps can possibly end up self-managing on the grounds that they engage their stakeholders to put resources into the improvement of the Dapp. Thus, it is possible that Dapps for payments, data storage, bandwidth, and cloud computing may one day overshadow the valuation of multinational corporations like Visa, Dropbox, and Amazon that are currently active in that space.




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