Following the success of recent Bitcoin and Ethereum Spot ETFs, asset managers are actively pursuing the creation of spot ETFs for altcoins. Learn more here.

US president Donald Trump's return to office has ignited renewed institutional interest in 

 (ETF) applications centered on these innovative digital assets. This surge reflects a growing recognition of altcoins as viable investment opportunities. 

In this article, we’ll take a deep dive into the dynamic 

 landscape, spotlight key altcoins that are drawing ETF proposals and discuss the potential market impact and regulatory challenges. 

An altcoin spot ETF application is a formal request submitted to regulators to create an exchange-traded fund (ETF) that directly holds altcoins (cryptocurrencies other than 

) as underlying assets, allowing investors regulated exposure to the altcoins’ real-time market prices without owning the altcoins themselves.

How does an altcoin spot ETF application work?

The process of applying for such an ETF in the United States involves several detailed steps, primarily overseen by the Securities and Exchange Commission (SEC).

During its review, the SEC assesses several critical factors to determine whether the altcoin is suitable for inclusion in an ETF. The agency examines the market surveillance capabilities of the exchange, ensuring it can effectively monitor trading activities to prevent fraud and manipulation. In addition, the SEC evaluates custody solutions to guarantee secure storage of the altcoin, protecting it against theft or loss. Finally, the agency considers the liquidity and market size of the altcoin, assessing its market maturity through indicators (such as trading volume and market capitalization) to ensure it can adequately support an ETF structure.

Current altcoin spot ETF application landscape

 in the United States in 2024, asset managers have expanded their focus to other cryptocurrencies. Major firms Grayscale Investments, Bitwise, VanEck and Canary Capital have filed applications with the US SEC for ETFs tied to cryptocurrencies such as 

 from Bloomberg Intelligence have assigned a 90% approval probability for a Litecoin ETF in 2025, with 

, Solana and XRP following at 75%, 70% and 65% likelihoods, respectively. 

In the international scene, Brazil's securities regulator, the Comissão de Valores Mobiliários (CVM), 

 Spot XRP ETF, the Hashdex Nasdaq XRP Index Fund. This ETF allows investors to gain direct exposure to XRP through Brazil's B3 stock exchange without the need to purchase and store the cryptocurrency themselves. 

Why is there a sudden rise in altcoin spot ETF applications?

Several factors have contributed to the surge in altcoin spot ETF applications.

An overview of altcoins with spot ETF applications

The growing interest in altcoin spot ETFs has led several asset managers in the US to file applications for a range of digital assets. Below is a detailed list of the altcoins currently targeted by spot ETF applications, along with the companies behind each filing.

 is a high-performance blockchain platform renowned for its scalability, speed and low transaction costs achieved through its unique Proof of History (PoH) 

. In February 2025, the SEC acknowledged several Spot Solana ETF applications from prominent asset managers, as follows.

Currently under review, these applications collectively carry an estimated 70% likelihood of approval, though this outlook may be affected by the regulatory classification of SOL as a security. 

 is a decentralized cryptocurrency launched in 2011 as a faster, lower-cost alternative to Bitcoin. Dubbed "digital silver," it uses a 

 (PoW) consensus mechanism and serves primarily as a payment network.

Several asset managers have submitted applications for a Spot Litecoin ETF.

The SEC’s final decisions are expected by late 2025. Bloomberg analysts estimate a 

 for Litecoin ETFs in 2025, due to Litecoin’s commodity classification and reduced regulatory risks as compared to other cryptocurrencies. Analysts also highlight that Litecoin’s technical similarities to Bitcoin are favorable factors in the ongoing review process.

’s decentralized blockchain platform is designed to enable interoperability between different blockchain networks. Pending DOT Spot ETF applications include the following.

The applications are under review by the SEC, and 21Shares recently 

its application in early March, 2025, indicating active collaboration with the SEC. 

 is a third-generation blockchain platform that uses a 

 (PoS) consensus mechanism, making it more energy-efficient than PoW blockchains. It’s known for its rigorous, peer-reviewed development process and focus on sustainability, scalability and interoperability. 

filed the first-ever (and, so far, only) Spot Cardano ETF application 

 with the SEC, aiming to list the ETF on the New York Stock Exchange (NYSE). 

Grayscale's Spot Cardano ETF application is currently under review by the SEC, with the regulatory body 

 on Feb 24, 2025. The SEC's decision is expected by August 2025. 

 is a decentralized public network that uses the novel 

 (based on a directed acyclic graph, or DAG) to offer high-speed, secure and energy-efficient transactions. It’s designed as an alternative to traditional blockchain systems, supporting applications across various industries like finance, gaming and healthcare. 

The following asset managers have submitted HBAR Spot ETF applications.

The SEC review process for the HBAR Spot ETFs has begun. It can take up to 240 days for a full response. However, HBAR isn’t considered a security by the SEC, which could potentially expedite the approval process for an HBAR Spot ETF. 

 is a decentralized oracle network that helps connect smart contracts to real-world data, ensuring that these contracts can securely and reliably access external information. 

Although no asset managers have filed for a Spot ETF focused solely on Chainlink (LINK), the asset is gaining exposure through broader crypto ETF filings. For instance, Hashdex's crypto ETF, which also features major cryptocurrencies like Bitcoin and Ethereum, includes Chainlink in its portfolio. This ETF application 

 on Nov 25, 2024, and is currently under review.

 cryptocurrency that originated as a satirical take on the burgeoning digital currency market. Despite its humorous beginnings, Dogecoin has developed a significant following and has been used in various charitable events and crowdfunding campaigns. 

Asset managers who have submitted applications for Dogecoin (DOGE) Spot ETFs include the following.

These applications are currently under review by the SEC, and a decision regarding Grayscale's application is anticipated by mid-October 2025. 

 blockchain platform developed by Ava Labs and launched in September 2020. It’s designed to support fast, scalable and secure 

The following asset managers have submitted applications for 

These applications are currently under review by the SEC. 

 is a Layer 1 blockchain platform developed by Aptos Labs, founded in 2021 by former Meta (Facebook) employees Mo Shaikh and Avery Ching. Leveraging the Move programming language, initially created for Meta's Diem project, Aptos aims to deliver a scalable, secure, and efficient infrastructure for DApps. 

As of now, Bitwise Asset Management is the only asset manager that has 

 for an APT Spot ETF. The application, submitted on Mar 5, 2025, is still pending with the SEC.

 is the native digital asset of the XRP Ledger, an open-source blockchain designed to facilitate fast, low-cost and energy-efficient cross-border payments. XRP aims to provide a scalable alternative to traditional financial systems such as SWIFT. 

All of these applications are currently under review by the SEC, with possible approvals expected later in the year.

 is a Layer 1 smart contract platform designed to enhance digital asset ownership by making transactions fast, secure and accessible. Its PoS consensus mechanism and use of the Move programming language enable Sui to support high-speed transactions and a wide range of DApps, positioning it as a scalable solution for various blockchain use cases. 

 with the SEC to launch an ETF tied to the spot price of SUI. This filing represents the first, and for now, only attempt to introduce a SUI-backed ETF in the United States.

The SEC has acknowledged receipt of Canary Capital's application, kicking off the regulatory review process. 

 is an Ethereum Layer 2 blockchain platform built to improve scalability and efficiency. It leverages the Move programming language for faster transaction speeds and lower costs, seeking to establish itself as a next-generation blockchain solution.

 for an ETF designed to track the MOVE token. Submitted on Mar 10, 2025, this marks the first, and currently the only, application for a MOVE Spot ETF.

The SEC is currently reviewing the application, having confirmed receipt.

Could this trend pave the way for crypto mainstream adoption?

The growing number of altcoin spot ETF applications and potential approvals could significantly impact the cryptocurrency landscape, potentially accelerating mainstream adoption. Here's how.

Historical data suggests that significant regulatory milestones, such as ETF approvals, often lead to market rallies. For instance, following the SEC's approval of Bitcoin Spot ETFs in early 2024, Bitcoin's price surged over 

, reaching a peak of $100,000. This rally contributed to the overall cryptocurrency market cap’s climb to approximately $3.5 trillion. Similarly, spot ETF approvals could trigger a bull run, as increased demand drives up prices. With easier access to crypto investments, more individuals and institutions may enter the market, further driving adoption and innovation within the ecosystem.

While the outlook is optimistic, it's essential to approach these developments with caution.

, and their market movements can be unpredictable. Investors should 

 and consider their risk tolerance before investing in cryptocurrencies or related products.

The altcoin Spot ETF landscape is rapidly expanding as asset managers like Grayscale, Bitwise, 21Shares and Canary Capital file applications for digital assets beyond Bitcoin and Ethereum. With ETFs targeting Solana, Litecoin, Polkadot, Cardano and other altcoins, these initiatives aim to enhance market accessibility and institutional participation, though final approval remains subject to regulatory review.

Intermediate

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Crypto ETF landscape: An overview of altcoins with ETF applications

Our weekly crypto derivatives analytics report delves into macro events; the current state of crypto and trading signals from spot trading volume; and futures, options and perpetual contracts.

Since hitting a local bottom on Mar 11, 2025, crypto asset prices have experienced a two-week rise, following a recovery above $87K for BTC and $2K for ETH. XRP remains stable, but BTC and ETH are still below their levels from the start of the year. SOL is also down for the year, despite reaching an all-time high (ATH) in January 2025 that coincided with the 

. While derivatives markets aren't bullish yet, they've reversed much of the bearish sentiment, although demand persists for puts on BTC and ETH.

Please check out the report’s highlights.

For most of this past week, perpetual open interest remained flat, reflecting a cautious risk-off sentiment across asset classes. This changed briefly with a partial spot recovery that allowed BTC to reach $88K (a two-week high), which led to slight increases in perp open interest and trade volume primarily driven by BTC. However, trade volumes are still significantly lower than at the start of the month when US president Donald Trump proposed a crypto strategic reserve for the big four tokens.

Negative funding rates point to bearish sentiment

Despite a week of lower realized volatility and positive performance among major crypto assets, funding rates for BTC and ETH contracts have remained mostly negative, indicating that short positions are paying long positions. This reflects a bearish sentiment not present in large-cap altcoins, whose funding rates have fluctuated between positive and negative without a clear directional trend.

Implied volatility levels have dropped by 3–5 points from last week, with 30-day options trading at their lowest level since the year's start. Realized volatility is nearing the 30% low established in late February. As is typical during periods of low volatility, options market activity has decreased, with open interest remaining low and balanced between puts and calls despite about $40M in weekly expirations.

Advanced

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Bybit X Block Scholes crypto derivatives analytics report (Mar 27, 2025): Cautious sentiment prevails despite price recovery

Learn about Mubarak (MUBARAK), the BNB Chain meme coin fueled by community hype and speculation over potential listings.

Mubarak (MUBARAK) is a community-driven meme coin on 

 that’s quickly gaining popularity, due to strategic community engagement and cultural branding targeted toward Middle Eastern investors. This guide explores Mubarak’s unique features, tokenomics, recent market performance and trading options.

Mubarak (MUBARAK) is a community-driven meme cryptocurrency built on BNB Chain. It was launched on the 

 Inspired by an Abu Dhabi company’s $2 billion investment in Binance, MUBARAK — which means “blessed” in Arabic — carries a unique appeal for Middle Eastern crypto markets. This targeted cultural approach distinguishes MUBARAK from other 

, giving it particular appeal in regions with growing crypto enthusiasm.

Shortly after the coin’s launch, its community quickly took control over it, guided prominently by the influential persona 

 on social media platform X. Users can also create Mubarak-themed avatars on the website, giving influential figures a dash of Middle-Eastern charm — from CZ and Portuguese soccer star Cristiano Ronaldo to beloved meme coin mascots 

. The meme coin quickly attracted attention, due to its engaging branding and strategic community management, amassing a total of 12,400 followers in just two weeks. 

What’s the source of MUBARAK’s popularity? 

MUBARAK stands out from typical meme coins, thanks to several major Binance-related events accelerating its market visibility. 

On Mar 12, 2025, Abu Dhabi investment company MGX made history by investing $2 billion in Binance. This represented the largest single investment in the whole of cryptocurrency history, signaling strong confidence in the industry. It was also a pivotal moment that firmly established the Middle East as a key player in the crypto space. Right after MGX’s mind-blowing investment, CZ tweeted several Mubarak-related posts, leading to the eventual birth of MUBARAK the very next day.

Binance Alpha, a dedicated platform for emerging and promising BNB Chain tokens, promptly listed MUBARAK on Mar 15, 2025, further validating the meme coin's potential. This integration enhanced MUBARAK's credibility, trust and market exposure, attracting a broader investor base beyond that of typical meme coin enthusiasts.

The second significant event that led to the greatest boost in its price and market cap took place when CZ personally bought 1 BNB worth of MUBARAK (around $600 at the time of purchase) on Mar 17, 2025. Both its listing and CZ’s purchase of the coin within a matter of two days pushed the coin to an all-time high (ATH) of $0.21 by Mar 18, 2025. While MUBARAK rapidly declined from its ATH to $0.13 just one day later, CZ’s cryptic endorsement for the coin briefly ignited more community excitement. 

On Mar 19, 2025, CZ sparked speculation in the Mubarak community by changing his X profile picture to feature himself wearing traditional Arab attire. The crypto community widely interpreted CZ’s subtle gesture as a potential endorsement or “hint” toward future Binance involvement. This led to a rapid increase in Mubarak's price (over 30%) within the same day as it reached $0.165 and briefly touched a $166 million market cap.

Mubarak’s straightforward and transparent tokenomics (below) are designed to foster investor confidence and community engagement.

Mubarak's simple token structure and availability on a reputable 

 (DEX) enhance accessibility, providing investors easy entry and liquidity options without relying solely on 

As of Mar 28, 2025, MUBARAK is priced at $0.096, reflecting a 55.3% decrease from its ATH of $0.21 on Mar 18, 2025, and a 237% increase from its all-time low (ATL) of $0.028 on Mar 16, 2025. It has a current market cap of $95 million and a 24-hour trading volume of $306 million.

MUBARAK’s price surged over 480% from the time of its launch, primarily due to strategic visibility from its Binance Alpha integration, speculative interest following CZ’s interactions and growing enthusiasm for meme coins in the crypto market. At its peak, MUBARAK achieved a market cap of approximately $166 million, reflecting significant investor confidence and demand.

Mubarak (MUBARAK) has quickly established itself as an influential meme coin in the crypto market, boosted significantly by strategic integrations like Binance Alpha, and speculative attention fueled by former Binance CEO Changpeng Zhao’s interactions. Its unique cultural branding, particularly appealing to Middle Eastern crypto circles, has further amplified its market visibility and adoption. However, investors must approach meme coins with caution due to these assets’ speculative nature, which often leads to considerable volatility and potential risks.

If you're interested in participating in MUBARAK’s growth story, you can trade 

, where you can participate in high-risk/high-reward Perpetual contract trading with up to 12.5x leverage.

Beginner

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Mubarak (MUBARAK): Arabic-themed BNB Chain meme coin

Margin Staked SOL is a Bybit product that allows you to earn SOL staking rewards and utilize leverage of up to 2x to amplify your earnings.

 can be a great way to earn yield in crypto, and 

 (SOL) is one of the most popular blockchain platforms for doing so. However, setting up and running a Solana validator node is technically complex. Additionally, financial requirements for Solana validators are high. While the official minimum stake is just 0.01 SOL (around $1.33), in reality, a typical Solana validator needs 

 staked just to break even — an investment of about $6.66 million (as of Mar 28, 2025).

Most crypto users who would like to benefit from staking rewards on Solana simply don’t have that kind of capital. And many don’t want the hassle of setting up a full validator node.

Back in September 2024, Bybit introduced 

 (LST) that lets you earn Solana staking rewards with minimal investment, and no need to manage a validator node.

bbSOL has been a major success, allowing Bybit users to earn staking rewards without technical or financial barriers. Now, Bybit is taking it a step further with Margin Staked SOL — a new Solana staking product that utilizes bbSOL and offers leveraged borrowing to amplify the rewards.

 is a Bybit leveraged liquid staking product that’s designed to help you earn Solana staking rewards with minimal hassle.

 Using it, you can invest your SOL and Bybit will allocate the funds to Solana blockchain validators, allowing you to earn staking rewards. When you stake through Margin Staked SOL, you receive bbSOL, an LST that serves as a deposit certificate and accrues staking rewards. Unlike standard bbSOL staking, Margin Staked SOL allows you to use 

For example, if you have 100 SOL and opt for 2x leverage, the total amount committed to Solana staking will be 300 SOL — your 100 SOL principal plus the borrowed 200 SOL. You’ll pay interest (which is variable and calculated hourly) on the borrowed amount.

Bybit allocates your total staking amount through 

 (CLOUD), Solana's leading liquid staking solution. Sanctum's 

 distributes staked funds across multiple validators to optimize the total yield.

The key advantage of Margin Staked SOL is its capacity to amplify staking rewards through leverage. In addition, you don't need to handle the technical complexities of running a Solana validator. The minimum investment required is just 0.5 SOL (around $70), drastically lower than the millions of dollars needed to run a profitable validator node in Solana's highly competitive staking ecosystem.

Upon committing your funds to Margin Staked SOL, you’ll receive the bbSOL LST. All staking rewards accrue in this asset, and you can redeem your investment at any time by exchanging bbSOL for your original SOL. After deducting interest on the borrowed funds, you’ll receive your SOL, along with all the accrued rewards. bbSOL accumulates rewards every time a Solana epoch is completed, typically taking 2–3 days.

As an LST, bbSOL normally allows you to keep your original SOL locked while using the liquid token across the Solana 

 (DeFi) ecosystem, and within Bybit products like On-Chain Earn, Bybit Savings and Crypto Loans. However, when bbSOL is issued via Margin Staked SOL, it must remain locked, and cannot be used in other Bybit or DeFi products. It acts solely as your deposit confirmation, and continues accruing rewards until you withdraw from Solana staking via Margin Staked SOL.

Interest on the borrowed funds within Margin Staked SOL is calculated hourly, with any duration under one hour rounded up to a full hour. The interest rate is variable, and updates every hour. You can check the current rate in your account under 

Rewards in Margin Staked SOL aren’t distributed immediately. Instead, they accumulate in your bbSOL, and can be redeemed at any time alongside your SOL principal investment. Bybit provides two redemption options for bbSOL:

If your PnL position declines beyond a certain level during staking, Bybit will send you a margin call notification via email, prompting you to either redeem your investment or contribute more SOL. If your PnL drops even further, an automatic stop-loss transaction will be triggered to redeem your funds and cover the loan and accrued interest. These measures are designed to protect you from unexpected losses.

Besides Margin Staked SOL, Bybit also offers another product for those who would like to earn yields from hassle-free decentralized staking: 

. There are three key differences between the two products: 

1) Unlike On-Chain Earn, Margin Staked SOL allows you to use leverage, amplifying your potential returns and risks. 

2) On-Chain Earn creates opportunities for staking on several blockchains, while Margin Staked SOL is a solution that’s designed exclusively for Solana staking.

3) Staked assets in On-Chain Earn can be withdrawn and utilized in their respective blockchain ecosystems, whereas the bbSOL from Margin Staked SOL is locked solely for yield generation, and cannot be used elsewhere. 

How to get started with Margin Staked SOL

Here’s how to get started with staking your SOL.

: In your account’s navigation pane, click on 

: On the left side, you’ll see the APR chart for the product, containing information on the Net APR; the trend over the past 1,7 or 30 days; and the highest and lowest Net APRs over a selected time period.

: On the right side, you can set options for your Margin Staked SOL (the leverage ratio and the SOL amount to transfer from your main account). You’ll see the amount of automatically calculated bbSOL you’ll receive, total borrowed amount and estimated daily yield.

to view a detailed breakdown of your bbSOL holdings. Then, click on either

: On the confirmation pop-up window, enter the amount of bbSOL you wish to redeem, or click on 

to redeem your full balance. Review the details, then click on

 to proceed, depending upon your earlier choice. 

to finalize your redemption on the redemption confirmation pop-up. Your redeemed SOL will be sent to your 

Until Apr 4, 2025, 10AM UTC, you can also take advantage of Bybit’s 

 campaign that’s dedicated to the Margin Staked SOL product. This campaign lets you earn up to 10 Lucky Draw tickets, each guaranteeing at least a 1 USDT 

, with a chance to win up to 100 USDT. In order to participate in the campaign, you must register for the event and complete a series of tasks as follows:

Bybit’s Margin Staked SOL allows you to earn Solana staking rewards without the hassle of setting up and running a validator node — all via your account’s easy-to-use interface. The leverage option is also a great way to multiply your rewards. Moreover, the minimum investment is minuscule, especially compared to running a Solana validator, and there are two easy redemption options — and all of these benefits without needing to interact with the underlying Solana blockchain!

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Bybit Margin Staked SOL: Unlock higher yields with less effort

Bybit Learn

Blockchain

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Decentralized apps (DApps) are open-source software apps designed to run on P2P blockchain networks. Find out more about how they work and why they exist.

Technology has spoken: The world no longer needs middlemen. 

Thanks to decentralized apps, or DApps, you no longer have to go through a company or single authority to connect to people or the goods and services you need. Unlike conventional apps, DApps aren’t owned by a single entity, they never have downtime, and they cannot be shut off. This novel breed of application is quickly changing the app game and the world. 

Below, you’ll learn all about DApps, how they work, why you should use them, and some of the challenges this new type of app faces both now and in the days ahead.

 and DApps becoming more and more popular, chances are that you’re wondering — like millions of others — what DApps are and what this new technology is all about. Essentially, DApps are applications just like any other, but instead of running on a single server, they run on decentralized P2P networks. This means there is no single central authority.

 and decentralized networks supported by distributed 

 ledgers, DApps can be continually improved and built upon by others once the codebase has been released. This makes their control by a single authority virtually impossible.

, and other distributed ledger technologies have helped popularize DApps. The use of blockchain allows DApps to process data and execute transactions through 

DApps have been created for a variety of applications, ranging from gaming and social media to web browsing and DeFi. Unlike web-based apps, DApps are always accessible and are not exposed to any single point of failure.

DApps are still in their nascent stage, so the specific definition of a DApp or the criteria needed to be considered a DApp isn’t something that can be explained in a single line. Nonetheless, in 2014, a 

 was released defining DApps. In it, DApps were defined as entities meeting the following four criteria:

The first and most crucial criterion for a DApp is that its core source code must be available to everyone. It must be user-controlled and work without any third-party intervention, and no entity can own more than 50 percent of the tokens or coins issued. While it was created several years prior to Ethereum, which is the blockchain network most DApps are built on, Bitcoin is an excellent example of a DApp, as its code is open-source, it has no majority owner, and it’s governed by a proof of work consensus mechanism.

As their name suggests, DApps use decentralized blockchains. In fact, to be considered a DApp, all information must be stored in an openly accessible blockchain to keep the app free of centralized authority and invulnerable to any central point of attack.

Since DApps are based on decentralized blockchain networks, everyone who validates their records must be incentivized or rewarded with digital assets, such as cryptographic tokens. These tokens serve as payment to miners and stakers, who are necessary for the DApp’s continued operation and growth.

A DApp must run according to a protocol, and the development community must agree on a 

 (PoW) cryptographic algorithm as a means of showing proof of value.

Under this definition and according to these criteria, many cryptocurrencies, like Bitcoin, can be considered DApps, even if in a rudimentary sense. In fact, even without the use of smart contracts, a blockchain in and of itself can be considered a DApp.

Like Bitcoin, blockchains can host DApps with their own blockchains. Or, like Ethereum-based blockchains, non-blockchain based DApps can be built on top of existing blockchains. If all of this starts to sound a bit confusing, just remember DApps and blockchains go hand-in-hand.

DApps may be getting a lot of shine these days, but they’re nothing new. In fact, for all of you younger millennials out there, you may be surprised to know that they even predate Bitcoin. That’s right; DApps have been around since the thought of blockchain technology was, well, just a thought.

If you were born post-1995, you may not have heard of some of the earliest decentralized applications. The most famous were 

 (which was influential in the naming of Bitcoin), 

. However, back then, the term “DApp” didn’t exist. If it did, no one knew it, and it certainly wasn’t a part of everyday nomenclature like it is today.

It wasn’t until P2P file sharing, which preceded blockchain, that DApp usage really started taking off. Websites leveraging BitTorrent protocol, for example, are still widely used around the world today, despite always seeming to be in regulatory hot water.

Today, however, DApps are mostly talked about in relation to blockchain, as many decentralized software startups utilize the technology’s native properties as foundations for their apps. By leveraging existing networks, there’s less need for development costs. Bitcoin and similar systems also allow for the distribution and tracking of native tokens given out to backers during project launches.

That said, as mentioned, decentralized applications have continued to evolve with blockchain technology, and most modern DApps are built on Ethereum, which many consider a second-generation blockchain. In addition to basic proof-of-work protocols for ledger management, these second-generation blockchains are layered with smart contract functionality to create a developer-friendly framework and ecosystem.

While Bitcoin was the world’s first blockchain, the once revolutionary technology has quickly evolved far past processing simple financial transactions. When Ethereum was proposed by Vitalik Buterin in 2013, his sights were set on something much bigger —a  decentralized world.

Buterin envisioned an internet based on blockchain, one where corporations didn’t have control, users did. To do so, Ethereum developed the now widely used smart contract. Essentially little more than automated if-then statements, these contracts are immutable and have rules and limitations built right into their code. This allows any party to transact without the need for an intermediary or centralized platform. This type of DApp is the one we know today.

A DApp is executed and stored on a blockchain network, commonly using Ethereum but now utilizing various tokens native to other networks as well. Cryptographic tokens are used to validate the app and are required to access the application.

In many ways, DApps are quite similar to conventional apps, as they both render web pages using the same front-end code. If you’re still wondering what DApps are, it’s the back-end code that makes them different, since they run on decentralized P2P networks.

While traditional applications are supported by centralized servers, DApps are supported by smart contracts stored on a blockchain. When it comes to using smart contract technology, the most popular blockchain to date is Ethereum, though competitors are numerous and proliferating.

A smart contract mediates transactions and enforces rules written into the code. While important, they only exist on the back end and make up just part of the complete DApp. Creating a DApp based on the use of a smart contract system requires combining a number of smart contracts for the back end. For the front end, third-party systems are used.

Smart contracts run on a ledger of data stored in blocks. Rather than being stored on a server in a central location, the blocks are dispersed across distributed locations. Each of the data blocks are linked and governed by cryptographic validation.

Using this decentralized blockchain as well as smart contract technology, DApps can be created and used for almost anything, including:

DApps run on distributed systems and aren’t owned by a company or individual, giving them their own unique advantages. Of course, because technology is always changing, DApps are works in progress. Let’s go over their pros and cons.

As you now know, DApps don’t rely on a central server. Because of this, they’re often regarded as being more secure than traditional centralized applications. Given the rampant

 taking place these days, anything you can do to secure your data should definitely be a priority.

Since DApps are hosted across expansive decentralized networks, there’s virtually no need to worry about data loss. If one of the blockchain’s nodes goes down, all of the other nodes pick up the slack to ensure your data remains in sync — and that you don’t miss a beat.

Each node of a blockchain syncs with the others to accurately track every action taking place within the network. This is how new transactions are verified. Would-be attackers must control a majority of the network’s computers for a successful intrusion, but even then, they must bypass cryptographic encryption.

While this alone isn’t impossible, it’s extremely difficult within a distributed, decentralized system. That being said, there’s no absolute guarantee of data safety these days, regardless of which type of app you’re using.

Not only must conventional, centralized apps act according to their country’s laws and regulations, but they must also follow the Terms & Conditions they themselves arbitrarily set when deciding which content they should and shouldn’t publish.

DApps, on the other hand, have no central authority telling community developers and users what they can and cannot say, which transactions they can or cannot make, or even what blockchain data they can read.

Centralized apps often have higher costs. For instance, applications like YouTube profit by taking a percentage of what their users earn from their video postings. Apps that are decentralized allow users to transact directly through the use of cryptocurrency. They are thus more financially efficient, and have no middlemen to cut into profits.

With greater flexibility and more robust than centralized apps, due to their lack of connectivity to a single central server, DApps can run with minimal downtime and fewer interruptions for maximum resilience and continuity.

Executing global transactions takes place very quickly, as no third parties exist to approve each one. Since transaction approval is based on consensus algorithms within the network, expensive third parties can be eliminated and transactions can be executed much faster.

Having no central authority also means slower updates. Even fixing a minor bug requires majority consensus among every peer in the network. With this governance structure, it can take weeks and sometimes months before a problem can be fixed and an update made.

DApps also require a sizable user base in order to operate properly. The more users an app has, the more effective it will be in delivering its services. This is known as the 

. Many newer DApps suffer from low user numbers, making them less interactive and diminishing the overall user experience.

What Are Decentralized Apps (DApps) & Why Are They Used?

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