Like the name suggests, a centralised app is owned by a single company. The application software for such an app resides on one or more servers controlled by the company. All users interact with the app by downloading a copy of the app and then sending and receiving data back and forth from the company’s server.
A decentralised app (also known as a dApp or dapp) operates on a blockchain or peer-to-peer network of computers which enables users to engage in transactions directly with one another as opposed to relying on a central authority. The user of a dApp will pay the developer an amount of cryptocurrency to download and use the program’s source code which is known as a smart contract, this allows users to complete transactions without revealing personal information.
What Are Examples of Centralised and Decentralised Apps?
Popular examples of centralised apps are Twitter, Facebook, Instagram, and Netflix. Banks and other financial institutions use centralised apps to allow their customers online access to their accounts.
Peepeth, a social network alternative to Twitter, is an example of a decentralised social media app. Cryptokitties is a dApp game which allows users to buy and sell virtual cats. MakerDAO is a decentralised credit service supporting the stablecoin Dai and allows users to open a collateralized debt position (CDP).
Conclusion
In this article, we learnt about decentralised applications from scratch. We tried to understand the basics of blockchain followed by the basics of dApps. Then we discussed the advantages, disadvantages, pros and cons of dApps to get a better idea about them. We also learnt the major differences between centralised and decentralised apps and learnt some examples of each.
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