Decentralized Applications

Chapter 1. What Is a Decentralized Application?

A new model for building massively scalable and profitable applications is emerging. Bitcoin paved the way with its cryptographically stored ledger, scarce-asset model, and peer-to-peer technology. These features provide a starting point for building a new type of software called decentralized applications, or dapps. Dapps are just now gaining media coverage but will, I believe, someday become more widely used than the world’s most popular web apps. They are more flexible, transparent, distributed, resilient, and have a better incentivized structure than current software models. This is the first book that will help you to understand them and create your own.

Preliminaries: What Is Bitcoin?

Before we get into the details of dapps, let’s talk a little about Bitcoin and the Web. We’ve seen the Web grow considerably, by orders of magnitude, over the past decade. Billions of people are coming online as Internet-connected device distribution expands globally. At first glance, the standards of communication set in the Internet Protocol Suite seem to be working well enough: the Link Layer puts some data on a wire; the Internet Layer routes the data; the Transport Layer persists the data; and the Application Layer delivers abstractions of the data in the form of applications. All four protocols work together seamlessly for exchanging data, but not value. Bitcoin acts as a fifth protocol layer for value transfer that lives up to the standards ...