A Guide to Decentralized Apps (dApps) with Examples

Decentralized applications (dApps) form the basis of web3. Powered by smart contracts that run on a blockchain, dApps have many features that regular applications do not — enabling functionality that was never possible before on the internet.

Today, the most popular dApps are decentralized finance (DeFi) platforms but the dApp ecosystem stretches way beyond DeFi, into realms like decentralized social media, web3 gaming platforms, identity solutions, and more.

In this blog post, we will explain the meaning of dApps, their advantages over traditional web2 apps, and dive into the different types of them you might encounter.

Ready to understand everything there is to know about dapps? Let's dive in.

What is a decentralized app (dApp)?

dApps, also known as decentralized apps or blockchain apps, are apps powered by smart contracts that run on peer-to-peer blockchain networks. Blockchain apps were first introduced on the Ethereum network, since it was the first chain to support smart contracts, but today, there are countless blockchain apps or dapps across multiple chains and ecosystems.

While they share many similarities with traditional apps, such as operating on your desktop or mobile and executing tasks, the way they do so is a little different to web2. Let's dive into why they are important to understand why.

Why are decentralized apps (dApps) important?

Put simply, dApps offer multiple advantages compared to regular web2 apps. Namely, that they are decentralized, eliminate downtime, offer unparalleled security features and allow for community governance. Here's how:

Decentralized architecture

dApps are specifically designed to operate without any middlemen: their code is contained in a smart contract which allows users to execute functions directly and without the need for centralized control.

And since these apps are published on decentralized networks, they are immutable: once developers deploy the dApp code, no one can take it down.

No downtime

Instead of storing user data on centralized servers, developers host dApp data on decentralized storage providers like IPFS. This means there is no single point of failure, and as a result dApps mostly never face outages or downtimes.

Governed by the community

Often, dApps are ownerless: no company or organization can unilaterally censor or block users from a platform. Instead, they often rely on decentralized governance structures, called DAOs, to moderate discriminatory and harmful community activities. Typically this will involve a governance token which acts as voting power in the community's ecosystem.

Robust security

Hackers cannot alter transaction data because dApps leverage sophisticated cryptographic technology to immutably store data on decentralized networks. It is also extremely difficult to launch a denial of service (DoS) attack on dApps.

That said, dapps face other security risks, so it's important to build web3 apps with the correct infrastructure.

Types of decentralized apps (dApps)

Just think of how many different types of web2 apps there are. Well, web3 apps are just as diverse and new types of applications and services emerging every year. Truthfully, the possibilities are endless!

That said, there are some blockchain apps you'll encounter more than others, so let's take a look at them:

DeFi Apps

Today, DeFi is a popular alternative to traditional finance. There's now a DeFi users participate in financial activities without the intervention of banks and other centralized intermediaries. DeFi dApps offer different financial services like lending-borrowing, token swapping, prediction markets, investment platforms, payment protocols, insurance providers, and crowdfunding agencies.

Decentralized exchange (DEX) apps

Decentralized exchanges allow users to trade crypto without any intermediaries. With traditional exchanges, you're forced to wait for a user willing to buy assets for the price you are selling, with decentralized networks, you pay a price calculated by a smart contract according to how much liquidity is in the liquidity pool. This is called Automated Market Maker system, and it stands out from the order book system traditionally used by banking institutions and centralized finance.

Examples of DEXs

Uniswap, a DeFi application on Ethereum, is a decentralized exchange (DEX) to swap and trade any ERC-20 token.

Aave is another decentralized open-source liquidity protocol based on non-custodial liquidity markets. Users stake (deposit) Aave to secure the protocol and earn rewards.

Staking apps

Staking mechanisms are simple: they force users to lock up a set number of tokens in order to receive rewards. Exactly how the staking mechanism works depends on what kind of token you stake.

To explain, chains that run on Proof-of-Stake (PoS) consensus mechanism rely on users locking up tokens as collateral in order to validate transactions. This is to guarantee the network's security. The idea is that putting up a large amount of funds as collateral encourages participants to validate transactions honestly. In return for the security they provide, the PoS chain rewards these participants, also called validators, with tokens. This is the core staking mechanism, but it's often out of reach for most crypto users, since becoming a validator can be extremely expensive. For instance, the Ethereum networks requires validators to stake 32ETH.

Pooled Staking apps

If you want to make the most of staking without running your own validator node, a great option is pooled staking; wherein multiple users pool their assets together to fund a validator. The validator validates transactions, receives the rewards, and distributes them to the users that funded the work, proportionally to their original stake.

Pooled staking apps are becoming increasingly popular across the board, so if you're building a DeFi app, it's a genre to consider.

NFT Staking apps

You can also introduce staking mechanisms in NFT projects to allow holders to stake their NFTs in return for a reward, usually an ERC-20 token. Essentially, the staking mechanism encourages holders not to sell their NFTs. The result? Fewer NFTs from that collection available on the market, and thus their scarcity on the market should drive up the asset's price.

If you want to add staking to your web3 app, simply deploy thirdweb’s Staking contracts . We've got a staking contract for every token you might need, including ERC-20, ERC-721, and ERC-1155 tokens.

Prediction Market apps

Prediction market apps have taken the world by storm. Starting the craze with Polymarket taking off during the US Election Campaign, prediction market apps have become an industry favorite and have also captivated audiences outside crypto. Put simply, they allow for betting on the outcome of sports games, elections, or anything you'd like, but without a middleman. It's changed the whole game of betting on odds!

Examples of Prediction Markets

Polymarket is example of a DeFi app that isn't an exchange or lending platform. Instead, it is a decentralized prediction market, allowing users to bet on the outcome of sporting events, elections and more.

Consumer Apps

Consumer dApps have the potential to offer a better customer experience compared to their web2 counterparts.

For example, brands could distribute NFTs to loyal customers and token gate their storefronts. NFT holders get exclusive access to special merchandise, extra discounts, and customized offers. Or perhaps, they could generate new revenue streams with NFTs.

Developers can easily build web3 apps on Shopify with thirdweb’s prebuilt smart contracts.

Decentralized Marketplace apps

A marketplace dApp is a platform for buying and selling digital assets.

NFT Marketplace apps

NFT marketplaces enable artists and content creators to tokenize their content and sell them as NFTs. On the marketplace, sellers list NFTs for direct sale or auction, and buyers purchase or place their offers/bids.

The thirdweb Marketplace V3 contract lets you develop on-chain NFT marketplaces for ERC-721 and ERC-1155 tokens quickly and simply. This contract offers features like reserve listings for specific buyers, multiple currency support for NFT payments, and additional offers for unlisted NFTs.

You can also deploy thirdweb’s Split contract to designate multiple wallets for revenue and royalty distribution. This contract automates revenue allocation to specific wallet addresses (like team members and artists) from secondary NFT sales.

Examples of NFT Marketplace apps

OpenSea and Rarible are two popular NFT marketplaces.

Decentralized & Web3 Gaming

Web3 games leverage onchain tokens to offer players sovereign ownership over their in-game assets and unlock new revenue streams. Web3 games let you launch in-game currencies as erc-20 tokens and in-game items as NFTs. Players can then trade their NFTs or tokens on secondary marketplaces; or track asset provenance and authenticity.

thirdweb's web3 gaming infrastructure helps developers to build high-quality web3 games, providing customizable in-app wallets, pre-built contracts, easy-to-implement web3 payment solutions and more.

Examples of Decentralized Gaming apps

Heroic Story's Fortunata, a Dungeons & Dragons-style multiplayer tabletop role-playing game, was built with thirdweb’s NFT contracts. Similarly, platforms like Fractal also used thirdweb’s integrations and SDKs.

DAOs

Decentralized autonomous organizations (DAOs) are blockchain-based entities where participants use crypto tokens for governance decisions without the intervention of centralized intermediaries. The DAO members vote on proposals and a member’s voting power is proportional to the number of tokens they own.

A DAO functions on reputation economics. The community collectively blacklists malicious actors or slashes their token holdings and honest voters receive incentives for good deeds.

thirdweb DAO contracts offer everthing you need to create DAOs, manage treasuries, and enable participants to vote on DAO proposals. For example, the Vote contract specifically helps developers to design code for DAO voting. This contract ensures votes for protocol upgrades, management, and distribution of funds in a treasury.

Examples of DAO Apps

Examples of DAOs include MakerDAO, Orange DAO, and the Bankless DAO.

Decentralized Social media Apps

Decentralized social media platforms store user data on decentralized networks rather than company-owned centralized servers. This gives users more control over their content and provides enhanced data privacy.

Web2 social media companies sell user data to third parties and rely on advertising campaigns for their revenue. However, decentralized social media networks use a token-based system for data monetization.

In the absence of a centralized company, web3 social media is immune to censorship and unilateral control of user content. Instead, community governance is important to moderate content on these platforms.

Examples of Web3 Social Media Apps

For example, Steemit, Mastodon and Farcaster are decentralized alternatives to web2 social media platforms; Reddit, Facebook and Twitter respectively.

Decentralized Entertainment Apps

Decentralized entertainment platforms empower content creators to have complete ownership over their content and connect directly with their audience.

Examples of Creator Platforms

For example, EVEN offers NFT-based music albums. Unlike web2 streaming platforms that pay a third of a penny per stream, EVEN allows creators to take 80% of revenue. Fans also get exclusive access to artist merchandise and tour tickets.

The EVEN team used thirdweb’s smart contract templates to build the platform.

Mirror, a web3 publishing platform, enables creators to publish content as on-chain digital collectibles. Publishers offer Subscriber NFTs to subscribed readers to reward them for their support.

Mirror uses thirdweb’s Signature Drop contract for signature-based minting to prevent non-subscribers from accessing Subscriber NFTs. Signature-based minting allows real-time verification to determine if a wallet can mint an NFT

Web3 & Decentralized Messaging Apps

Mega corporations like Meta dominate the traditional instant messaging and chat application market. They collect user data and monetize them in exchange for free service. Thus, users, sacrifice privacy for convenience.

Decentralized messaging protocols offer full encryption with a random set of nodes that transfers messages. This ensures no single entity can ever read a user’s message and sell them to third parties. For example, Briar uses such technology to protect user privacy.

Examples of Web3 Messaging apps

Wispr, another blockchain-based messaging application, uses the AES-256 encryption model. The app generates private keys for each conversation and destroys them after every session. Additionally, it converts the phone number into a Matrix ID to generate pseudonymous identities while exchanging messages.

Decentralized Ticketing Apps

The event ticketing industry has many problems like ticket scalping and price gouging. Scalping occurs in tandem with gouging when bots bulk buy tickets and sell them at much higher prices.

Additionally, legacy ticketing platforms charge hefty fees that adversely affect event managers, artists, and fans. Ticket fraud also remains a grave concern for the event management industry.

Decentralized ticketing platforms intend to solve these problems with trustless smart contracts and NFT-based tickets.

NFT tickets enable royalty splits from secondary re-sales. Blockchain-based ticketing also ensures traceability and transparency.

This technology helps to rein in scalpers and touts as they cannot profit from resales. Ticket provenance helps in secure ticket generation, eliminates fraud, and prevents revenue loss.

Examples of Decentralized Ticketing apps

For example, SeatlabNFT is a web3 ticketing platform that offers NFT-based decentralized ticketing solutions.

Other Decentralized app ideas

As mentioned, the dapp world is huge and it's still growing. There are so many different models to choose from, and we can't include them all in this list.

But consider some of these other app ideas that you could adapt or take inspiration from.

For example, Decent, a platform that provides multi-chain NFT infrastructure, uses thirdweb’s Wallet SDK, Delayed Reveal feature, dashboard framework, and CommerceKit.

Then Noonshot, a no-code Web3 website builder, enables non-technical creators like artists, photographers, and illustrators to build an NFT storefront. Noonshot uses thirdweb’s SDK and smart contracts to help creators make their own websites and sell NFTs.

How to build a dApp

Have you found the perfect idea? Are you ready to know more?

Follow the steps in our guide on how to build a dapp!

Or if you're ready to get started, check out our audited smart contract templates. There's a ready-to-deploy contract for almost any web3 app, and they all come with the option to add custom extensions for advanced functionality!

The future of dApps

Dapps are the backbone of the web3 community. Without them, we wouldn't have integral platforms like Uniswap, ENS domains, or even web3 social media platforms like Farcaster. In the future, it's likely that web2 apps and web3 apps will be one - the benefits of decentralization are already significant and the space is only growing each day.

So what are you waiting for? Dive in and start building your own blockchain app!

If you have any further questions, join 40,000+ other builders in our Discord community— or reach out to our team directly for more info on how to get started with web3 apps.