4 Uses Of dApps
Thanks to technology, middlemen are no longer necessary.
DApps function like typical apps but the difference is that they are not governed by a single entity. DApps can’t be owned by a single company, they never go offline, and they can’t be turned off, in contrast to traditional apps. In this article, Tokenize Xchange – Singapore Crypto Trading Platform will introduce you to 4 uses of dApps that are now trending and developing.
The history of dApps
In 2008, Bitcoin was first introduced as a peer-to-peer network to maintain decentralization and solve the problem of double-spending. Despite being a simple blockchain, also known as blockchain 1.0, Bitcoin’s blockchain was an emerging technology against traditional finance and the foundation for the development of various blockchain generations.
>>> Read more: Everything you need to know about dApps
The rising demand for using blockchain as a platform to develop decentralized applications has spurred the birth of blockchain 2.0. In 2014, Vitalik Buterin introduced the concept of smart contracts in the Ethereum whitepaper. A smart contract is a contract that automatically executes when a predefined condition is met.
The advent of smart contracts has promoted the explosive development of the cryptocurrency industry. In which, decentralized applications (dApps) are an indispensable piece in many fields such as Defi, Transactions & Payment Services, and GameFi,…
Due to accelerated digitalization, the rising popularity of GameFi, DeFi, expanding e-commerce market, and the growing need of using blockchain technology, dApps have become popular in recent years. DApps provide extremely secure transactions with minimized security and storage exploitation risk.
Over the last few years, factors including the availability of numerous platforms for developing dApps, growing demand for swift, secure online transactions, etc are anticipated to drive market growth. The most recent report by Emergen Research projects indicates that the global dApps market will generate 368.25 billion US dollars in sales by 2027 compared to 10.52 billion dollars in 2019, with a healthy revenue CAGR of 56.1% over the same period.
The use of dApps in different fields
The first use of dApps is Decentralized exchange. Decentralized exchanges (DEXs) play an important role in swapping and exchanging cryptocurrencies. These dApps are developed based on smart contracts on different blockchains. We can take Uniswap, DEX on Ethereum, and PancakeSwap, DEX on Binance Smart Chain, as examples.
Uniswap, a DEX dApp on the Ethereum blockchain, was launched in 2018. Users can use Uniswap to swap and exchange ERC-20 tokens. Being the fourth-largest cryptocurrency exchange online overall and the most well-known decentralized exchange, Uniswap has a monthly user base of over 150 thousand and an average daily trading volume of over 200 million dollars.
On the other side, one of the numerous decentralized exchanges that make use of Uniswap’s source code is PancakeSwap. PancakeSwap is noticed with considerable 24 hours trading volume of over 100 million dollars.
MakerDAO, Curve, or AAVE are the most popular dApps in the DeFi world. These dApps are open-sourced liquidity protocols, offering users total transparency. Users can use financial services including staking, lending, borrowing, and earning interest on their deposited assets. Because dApps are decentralized, both lenders and borrowers can enjoy total anonymity.
Currently, the total locked value (TVL) of the entire Defi market is over $53 billion, according to Defillama. In which, MakerDAO, Curve, and AAVE accounted for 14.46%, 10.97%, and 9.79%, respectively.
The gaming environment on the blockchain is developing. GameFi is one of the hottest subjects in cryptocurrency right now, with new advancements offered more quickly than ever before because of the game’s exciting gameplay and financial benefits.
According to DappRadar, GameFi attracted 1.22 million unique active wallets (UAWs) in March, and more than half of the industry activity came from decentralized gaming apps (DApps) or play-to-earn games.
Splinterlands was named the 1st play-to-earn game dApp. Polygon is the most suitable layer 2 (L2) sidechain for GameFi. And the most played P2E games include Crazy Defense Heroes, Pegaxy, Arc8, and Aavegotchi.
The last use of dApps we love to introduce you is the metaverse. A metaverse is a virtual reality environment where people can communicate with one another in a setting created by a computer. The size of the worldwide metaverse market was estimated at 47.48 billion dollars in 2022, and it is expected to increase at a rate of 39.44% CAGR to reach 678.80 billion dollars in valuation by 2030, according to Strategic Market Research.
Numerous industries, including healthcare, education, real estate, etc, have applications in the metaverse. People frequently use the metaverse for business, art, or investments. Approximately half of the internet users worldwide join the metaverse in search of employment opportunities, art, and live entertainment, and nearly 40% for financial investment, education, and gaming.
As one of the products of blockchain technology, dApps provide businesses and common consumers with safe open-source applications. With the continuous development of blockchain technology, dApps are predicted to be more and more widely applied in plenty of aspects of daily life.
Cryptocurrencies are subjected to high market risk and volatility despite high growth potential. Users are strongly advised to do their research and invest at their own risk.