- What is ERC20?
- What is Dapp? Why dapps?
- Top 5 Dapps of 2021
The cryptocurrency space has its attention concentrated on Bitcoin. However, another blockchain technology that is taking the world by storm is Ethereum. Ethereum network is called the supercomputer of the world today and it is no exaggeration when we say it is revolutionizing the way we think about applications.
The Ethereum network is not just giving birth to many ERC20 tokens but is being used as a backbone technology for the latest defi projects, defi marketplaces as well as NFT marketplaces.
Numerous Dapps or decentralized applications have sprung up within the crypto space. Before we dive into the latest Dapps that you must know about as a crypto investor first let us understand what are Ethereum and ERC20 tokens?
What are Ethereum and ERC20 tokens?
To get a better understanding of what decentralized applications are we should first have a thorough understanding of what is Ethereum and ERc20.
Ethereum is often confused with its native token ether. While ethereum is the blockchain network, ether (ETH) is a cryptocurrency. The set of rules that Ethereum based projects or tokens must follow is called the ERC20 standard. These tokens built on the ethereum protocol are often referred to as ERC20 tokens. Read about What is ERC20 and its significance for ethereum in detail.
Is Ethereum the only protocol to build Dapps? No. There are other protocols such as EOS, NEO, Tron, Stellar, and Cardano. However, Ethereum is the biggest player in this game. Ethereum being a network protocol allows users to run and create smart contracts over the decentralized network. A smart contract is nothing but a book of code that contains the specific functionalities and the code to interact with other smart contracts.
While Bitcoin is famous for storing numbers Ethereum can store code.
What are Dapp developers so fond of Ethereum? Because Ethereum can remove the requirement of third-party for peer-to-peer transactions. Since there is no middleman due to the code, the transaction costs are reduced along with the time required to transact.
Just as Bitcoin acts as a store for value Ethereum removes the need for a middleman giving rise to a completely trustless system.
What is Dapp?
Now that we have a complete understanding of how important Ethereum and ERc20 tokens are. Let’s have a quick dive into what is dapp?
Dapp is just like any other software application we use, It could either be web-based or designed for a mobile installation. But what is it that makes dapps different?
Unlike the normal applications, these decentralized apps are built on decentralized networks, like Ethereum.
While a developer creates his own Ethereum smart contract he is doing nothing but writing a backend code for his decentralized app. While the user interface of the dapp is similar to that of any traditional app, the backend code is either completely or a part of it is built on the Ethereum network.
Decentralized apps are nothing but frontend combined with smart contract backend.
The backend code incorporates some Ethereum network-specific language including solidity, Vyper, and Serpent. The Dapp is capable of executing a code written in these languages once deployed onto the Ethereum main net or local test net.
Some middlemen and organizations tend to keep this sensitive information on their centralized servers which if disclosed can lead to innumerable security issues. However, this can be changed with the help of Ethereum Dapps and their pioneering role in bringing about Web 3.0.
The core of Web 3.0 is decentralization. Decentralization prohibits the control of large institutions over the information across the internet. Ethereum dapps with their decentralized functionalities are capable of delivering a completely free and accessible internet for everyone.
Ethereum has become a unifying ecosystem for thousands of unique organizations. Half of the functioning decentralized apps in the market have been built on the ethereum network. The number of users accounts for 600000. There is a wide range of Ethereum dapps from decentralized credit services to data markets and blockchain-enabled web browsers. According to reports, as of January 2021, more than $22 billion worth of digitized assets have been locked up in the exponentially expanding decentralized finance sector. Learn in detail about what is defi? and the latest defi trends you should look out for in 2021.
Dapps in Nutshell
|What is Dapp?||Why Dapp?||Top 5 Dapps 2021|
Top 5 Ethereum Dapps 2021
|Dapp||Category||Market Cap||Number of Users|
|Axie Infinity||Games||$7,409,733,854||1.85 million|
The Final Takeaway
Since the inception of Bitcoin, the crypto space has seen massive growth. The ability to store and protect data in a decentralized manner was the necessity of the hour given the increase in the amount of data breaches and monopoly over data. With the help of Ethereum and its ERc20 tokens and decentralized apps, it is now possible to deploy smart contracts across the globe to power the backend code of dapps.
With the increase in the number of dapps, we are certain to receive a free, fair and more accessible internet. The Dapps have made their way not just in decentralized finance (DeFi) but are also being extensively used as exchanges, games, and web browsers. Indeed, Ethereum has the power to revolutionize the entire crypto space.
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