A decentralized application (dApp) is an open-source software application on the blockchain. The decentralized nature of dApps means that once a developer releases the core dApp code, others can build on it. No third party has control over the application. The dApps system is used to build a variety of applications, including DeFi, web browsing, gaming, and social networking applications.

DApps are built on a decentralized chain that is supported by a distributed blockchain database. The use of the blockchain allows dApps to process data through distributed chains and perform transactions.

Although dApps may look like regular mobile apps, their background is different. Decentralized applications rely on smart contracts in a distributed network instead of a centralized system to function. This makes them more transparent, decentralized, and resistant to attacks, but also brings new challenges.

Are dApps useful?

Decentralization offers various advantages over centralized network applications. Above all, the removal of a third-party thanks to smart contracts.

Sending money through dApps means you pay no or minimal fees. Moreover, transactions are almost instantaneous thanks to decentralization, so it also saves time.

Decentralized applications are not run-on centralized servers. The advantage of decentralized platforms is that they are more resistant to all attack types because there is no physical device to target. This makes the chain more secure and prevents outages.

DApps can be used in almost any industry such as gaming, medical, management, etc. Using dApps is almost no different from traditional applications. While users benefit from any changes the app makes in the background, the app experience should be the same. This type of interaction with applications is referred to as Web 3.0.

Web 1.0 was a space full of information that anyone could access. Large companies have abused this over time. Even though these organizations provide their apps "for free", we pay for it with our data, which the companies then sell and make big profits.

The companies are in control of this information. They know what their users like to buy, how much money they have and who they know.

Compared to Web 1.0, users in Web 3.0 will be able to decide to share only the required information, for example for a medical examination or a loan, and choose who sees it and for how long.

There is also a trust issue with Web 1.0. In many cases, large companies have already shown that leakage of the private data is nothing new, and therefore it is increasingly difficult to trust someone with your personal data. By using Web 3.0 and dApps, you protect your privacy.


  • Not censorable
  • Continuous operation
  • Open source
  • Flexibility
  • User privacy


  • Congestion
  • Scalability
  • Maintenance
  • Difficult for beginners
  • Hacking possibility
Hacks and cheats:
Unfortunately, dApps can be vulnerable to hackers. 1.2 billion USD was stolen using hacks and exploits in the first quarter of 2022 according to DappRadar. That number is so high, it’s almost unbelievable. Poly Network was hacked, and more than 600 million USD (in various assets) was stolen in August 2021. Axie Infinity's Ronin bridge was hacked with a loss of over 500 million USD  in March 2022.
Hackers use all kinds of techniques to find flaws in dApps, including exploiting DeFi loans and attacking one of the most vulnerable areas in crypto – the cross-chain bridges. These allow users to transfer funds between different blockchains.
However, some attacks also relied on good old-fashioned techniques. In December 2021, Badger DAO lost approximately 120 million USD after hackers exploited a security flaw in the crypto wallet's requests to approve certain user transactions.

Analyst Opinion

Decentralized applications (dApps) are continuously being developed. However, there are already thousands of dApps that offer countless services, including gaming, investing in DeFi, and NFT trading. Always be very careful where you connect your wallet to avoid falling victim to a dApp scam or unknowingly confirming some dubious transaction. Once you connect your wallet to the dApp, you give it certain rights to handle your funds. These rights are usually defined in the smart contract of the given dApp.

Ondřej Tittl

Ondřej Tittl


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