Decentralized applications, dApps for short, are well received. According to a recent market analysis, more and more people and companies are using dApps on the Ethereum blockchain. Especially since the boom in the DeFi (decentralized finance) sector, the use of decentralized applications has been increasing rapidly. This is not only true for the leading blockchain platform Ethereum, but also for other platforms such as EOS or TRON. On the one hand, the increasing use shows the growing acceptance among developers and companies, but on the other hand it also underlines the mature and functioning technology behind the decentralized applications.
What are dApps?
To illustrate why the message about increasing usage is a strong sign for the block chain world, it is worth taking a quick look at how decentralized applications work. A dApp describes an application that is not developed centrally by a developer or an organization, but is developed decentrally and is linked to certain conditions. By definition, a dApp is based on a blockchain, is licensed as open source, is encrypted using a cryptographic procedure, and is used to generate tokens. Within the decentralized applications, there are further classes according to which the dApps can be categorized.
Well-known examples of dApps are the Ethereum-based cryptokitties, the Smart Contract Interface xcontract, or the decentralized market forecasts by Augur. The individual projects, or rather the code behind the respective applications, is freely accessible to everyone. In addition, they cannot be further developed centrally by a decision-maker. Any changes to the decentralized applications always require the consensus of all developers involved or the community. The security of the blockchain therefore also ensures that dApps are preferred in the decentralized financial sector.
Use of decentralized applications doubles within a few months
While a steady increase in the use of dApps has already been observed for some time, the use doubled in the second quarter of 2020 according to a current market report. The website DAPP.com observed a doubling of the use of Ethereum-based distributed applications in the now published report. According to DAPP.com, cumulatively over one million people used dApps on the Ethereum platform. The reason for this is the great success of decentralized financial applications. DeFi applications record a transaction volume of 5.7 billion US dollars from April to July.
An important contribution to the success of the DeFi sector was made by Compound’s governance token COMP, for example. This huge success catapulted the token to a new all-time high at $372.79. By June 15, 2020, there were an average of 7,682 active dApp users on the Ethereum platform. Shortly afterwards, the COMP token boosted this figure to an average of 11,230 active users. On June 21, the entire DeFi sector also reached a daily all-time high of $608,230,230.58 million. Ethereum continues to be the leading platform for dApps. Already at the beginning of the year, Ethereum united 55 percent of all dApps on its own blockchain.
A look at the development of new dApps also shows that many developers invested their time in existing applications in the second quarter. This can be seen from the fact that only 99 new dApps were developed and released across all blockchain platforms. In the first quarter there were 135 new dApps. Ethereum alone is responsible for 45 of the 99 distributed applications. Tron, in second place, recorded 33 new dApps. Overall, Ethereum, the second largest crypto project in terms of market capitalization, was able to further extend its lead over its competitors EOS and Tron. At present, it cannot be assumed that a challenger Ethereum will be able to step down from the throne of the leading platforms for dApps in the near future.