A few days ago, NFT was recognized as the Word of the Year (the Collins Dictionary version), and “crypto” was also shortlisted. “Bitcoin” was topping similar lists just a couple of years ago.
Unfortunately, people seem to have forgotten the “parent” of all three — blockchain.
In the mainstream consciousness, blockchain equates with bitcoin, which is so unfair to the former. This is because blockchain is so much larger as a tech category. Also, unlike bitcoin, blockchain can be used for exchanging money online and numerous other online transactions.
Let’s look at a few key benefits of blockchain.
When should a business implement blockchain technology and develop its own blockchain app?
- The first and most obvious is when your customers carry out a majority of their transactions using cryptocurrencies.
- When you are dealing with security-sensitive data (foreign property registration, for example), the presence of a middleman (even a virtual one) can be problematic.
- When your business model is based on transaction fees (for example, when you get a % as a service provider).
- When your business model is based on membership or subscription plans.
- When you are a socially responsible business that needs a secure app to collect donations for a good cause.
If at least one of the reasons above applies to your business, acknowledge the demand — you need a blockchain app.
What is a blockchain app and how is it different from a regular app?
For comparison purposes, let’s take a simple example of a popular app — Uber (any other taxi app would do as well). In it, both clients and drivers are contacting one centralized database that links the customer with a driver by following the preset parameters. In other words, the entire functionality of the app is core-dependent.
Blockchain apps do not have this core dependency. They function on network principles – using a distributed database. That’s why blockchain apps are also known as decentralized apps, or dApps (or simply dapps).
What are the benefits of dapps over more typically-used apps?
To some extent, decentralized apps demonstrate the same advantages as political decentralization (local self-management):
Lower transaction costs
Excluding the system’s core (which is basically just an intermediary) saves money, time, and hassle for every side involved.
Every participant interacting via a dapp will usually have equal access to all data related to the interaction. When it comes to medical, financial, and other sensitive data, transparency in data access always strengthens trust and, in the long term — customer/partner loyalty.
When there is no centralized controlling body, there is also zero chance for one-way data tampering. If there is any need to make edits to the existing data, a consensus with every user is required before executing any changes.
Having no central authority basically means there is no “top management approval” process. Thus, all necessary corrections and updates can be implemented much sooner.
How do I get started? The opening steps of dapp development
If you are knowledgeable enough with regards to the formal side of development, we recommend learning more on the tech side here. The following is an outline of the development process for non-experts:
This stage revolves around evaluating the fit of blockchain with your business case. Here at Unicsoft, we usually start with a blockchain feasibility analysis. We then define the scope of your data and determine what data will be private and public. When it’s done, we move on to outlining the smart contract logic.
- Product feasibility study
It’s time to dive deeper into which blockchain consensus and technology to implement. At the end of this stage, the Proof of Concept summarizes all the potential benefits that a blockchain stands to add to your project.
- Blockchain and app development
This stage breaks down to: a) creating smart contracts, b) Blockchain set up and integration with the product, c) web and mobile development, d) security auditing and e) final QA stage.
Although this stage is not directly related to the development of blockchain applications, it is the last point of the project’s completion. Here we provide monitoring for transactions executed in blockchain. Furthermore, we assist with third-line development support to ensure the product operates seamlessly.
What will my customers see on the user side?
Most customers will not be aware of the change from a regular app (unless you intentionally choose to emphasize the data security benefits in your marketing campaign).
Take Spotify for example. Back in 2017, Spotify acquired Mediachain Labs (a blockchain startup) to regulate music attribution (proper linking between tracks, musicians, and the corresponding license agreements). For Spotify, this meant that the risk of lawsuits for unpaid royalties reached the absolute minimum (the company used to have to pay millions in fines).
On the user side, the use of blockchain technology in the Spotify app simply means we get the latest music as soon as it is live and in an entirely legitimate way. Users are not even aware of the blockchain technology that is operating under the hood.
Hidden pitfalls to be aware of when developing a decentralized app
Try enrolling into Blockchain 101 to learn a little more and some of the basics — what mining is, what kind of tokens there are, what smart contracts are, and how useful they are. You probably won’t need to go through the entire Udemy course, but understanding the basic terminology is key.
Overcoming psychological barriers
Transparency might be an issue for some of your counterparties, especially if they come from banking, insurance, or healthcare. They may have multiple questions about data security. You need to be professionally prepared to explain why everything is no longer stored on one server. Hint: examples of similar dapps from your or similar areas are usually convincing enough!
Public vs. private blockchains
Dapps based on Ethereum and other popular blockchains are usually easier and quicker to develop. They are also operating some of the most popular cryptocurrencies.
However, businesses are increasingly preferring to have their own private blockchains. These require slightly more time, money, and planning to establish. Note that only a limited number of authorized users can access private blockchains.
Finally, know when to delegate.
If you do not have enough expertise and don’t want to build your dev team from scratch, delegating development is always an option.
The market for blockchain apps development is booming. Unicsoft has been operating in it for almost 10 years with dozens of blockchain projects implemented across every major industry, from fintech to entertainment.
Reach out and schedule your first call to get answers to all your questions from our business analysts and blockchain solution architects.