Apr 21, 2025: Our weekly Institutional Insights explores the latest market developments — market performance, industry news, exchange-traded fund (ETF) flows, trending topics, upcoming events and token unlocks — to help you supercharge your crypto trading.

 explores the latest market developments — market performance, industry news, exchange-traded fund (ETF) flows, trending topics, upcoming events and token unlocks — to help you supercharge your crypto trading.

Weekly highlight — Trump wants to fire Powell? 

US president Donald Trump is actively considering firing Federal Reserve Chairman Jerome Powell, following Trump's public criticism of Powell for not moving quickly enough to reduce interest rates. National Economic Council Director Kevin Hassett confirmed that the administration is examining this option, suggesting that Powell's actions have politically favored Democrats. Hassett argued that the Federal Reserve's decision to raise interest rates shortly after Trump took office was intended to undermine the economic impact of the tax cuts implemented during his administration, which were deemed inflationary. He further criticized the Fed for not addressing inflation concerns stemming from federal spending under President Biden, implying a lack of accountability.

During a recent press conference, Trump conveyed his dissatisfaction with Powell, asserting that if he wanted to remove him, it could happen "real fast." While he did not explicitly state his intention to dismiss Powell, his remarks highlighted the growing tensions between the White House and the Federal Reserve regarding monetary policy. Hassett defended Trump's frustrations, advocating for a focus on economic policy rather than interpersonal conflicts. This situation underscores the complex dynamics between the executive branch and the central bank, as Trump navigates economic challenges leading up to the next election.

Weekly crypto highlight — XRP ETF coming

HashKey Capital has officially launched the HashKey XRP Tracker Fund, marking the first investment fund in Asia designed specifically to track the performance of XRP, the digital asset integral to Ripple's global payment ecosystem. This fund is aimed at professional investors and offers a unique opportunity to gain exposure to XRP without the complexities of direct asset management. Investors can subscribe through cash and in-kind options, with the fund providing monthly liquidity.

Ripple, as an early backer of the fund, is looking to enhance its strategic partnership with HashKey Capital, which already manages Hong Kong–listed spot ETFs for Bitcoin and Ethereum. This collaboration not only solidifies Ripple's presence in the Asian market, but also opens avenues for future financial products, such as the potential tokenization of a money market fund on the XRP Ledger. Fiona Murray, Ripple's Managing Director for the Asia-Pacific region, highlighted that this partnership is part of a broader strategy to introduce more regulated cryptocurrency products for institutional investors in the region, aiming to foster a more robust crypto landscape in Asia.

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Weekly Institutional Insights: Trump’s desire to fire Powell might induce volatility; XRP ETF coming

Hong Kong's Securities and Futures Commission (SFC) has approved a new Ethereum ETF with staking capabilities, allowing institutional investors to earn staking rewards.

Daily top performer — Pyth Network (PYTH)

The S&P 500 dropped 1.5% to 5,282.70 this week, down 5.9% in April and 10% year-to-date, led by tech losses. Real estate and energy outperformed, while political pressure on Fed Chair Powell and inflation concerns weighed on sentiment. Gold dipped 0.6% to $3,319 after a record high, as Powell’s stagflation warning tempered its rally. Despite the pullback, the uptrend remains intact. The Coindesk Indices, which tracks the broader crypto market, are up by 0.77%, with Bitcoin and Ether rising 0.64% and 0.72%, respectively, over the past 24 hours. Trade these markets and more with up to 500x leverage on Bybit MT5 using this 

Today's top performer is PYTH, up 10.1%, following the launch of Pyth Entropy for secure on-chain random number generation by Soneium.

Pyth Network (PYTH),  is a blockchain oracle system that delivers real-time crypto price data to blockchains, enabling smart contracts to react to market changes. Soneium 

 Pyth Entropy, a tool for securely generating random numbers on-chain. Two apps, HandsNFT AI and 2p2e, are already utilizing Pyth Entropy to create unpredictable and engaging experiences.

Check out the latest prices, charts, and data of 

Hong Kong's Securities and Futures Commission (SFC) has approved a new Ethereum ETF with staking capabilities, allowing institutional investors to earn staking rewards. This approval follows recent changes to local laws, with China Asset Management (ChinaAMC) partnering with OSL Digital Securities to launch the ETF by May 15. The ETF will offer exposure to Ethereum staking, transforming it from a passive investment into an active participant in the Ethereum network. The staking process is powered by Kiln, with OSL providing custody and insurance services. The rewards will contribute to the ETF's net asset value, benefiting shareholders.

Yesterday, Bitcoin spot ETFs saw $25.9M in inflows, all from non-GBTC funds, while GBTC recorded no flow.

" and a points campaign called Drops, where users can earn points—potentially leading to an airdrop—by engaging with Linera content on X. To join, sign up on 

, complete tasks like joining Discord and interacting on X, then enter the campaign. Keep engaging to earn more points, but avoid spamming.

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Hong Kong approves Ethereum ETF with staking rewards, boosting institutional participation

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.

US president Donald Trump’s tariff policies are influencing both crypto and US equities. Last week, BTC and the S&P 500 rallied due to a 90-day pause in reciprocal tariffs (excluding China). Equities are slightly below their April 9 highs, while BTC is holding above $83K. Its implied volatility term structure has normalized, and the volatility skew has improved from last week’s bias toward out-of-the-money puts, though it hasn't fully shifted toward calls.

Please check out the report’s highlights.

Tariff pause briefly brings back trading volume

Since our last report, open interest surged on Apr 9, 2025, as crypto spot prices rose after President Trump’s temporary tariff pause, accompanied by a nearly $10B increase in trade volumes. However, trade volumes have since returned to mid-March levels, and open interest has declined from the April 9 highs. The initial price spike indicates the tariff pause surprised the markets, but the subsequent pullback reflects concerns over remaining tariffs.

After being inverted for much of April due to trade policy shocks and macro headwinds, BTC’s term structure has disinverted, with front-end volatility dropping significantly this week. Call and put volumes have been balanced, with calls slightly exceeding puts most days. Apr 9, 2025, reflected mixed market sentiment, as both call and put volumes rose, but puts were higher overall. Open interest remains greater in calls, and has increased slightly since last week, reaching its highest level for the month (more than double from the beginning of April).

Despite a rally on Apr 9, 2025 that brought ETH close to $1.7K, traders sought downside protection, leading to higher volumes in put contracts as compared to calls. Since then, ETHUSDT options volumes have declined, but open interest remains strongly weighted toward calls with later expirations, which have increased since last week. After being inverted for much of April, ETH’s term structure of volatility has flattened, with volatility compressing around the 70% mark across tenors.

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Bybit X Block Scholes crypto derivatives analytics report (Apr 16, 2025): Bitcoin put bias has moderated, but not yet shifted to calls

KiloEx (KILO) is a user-friendly DEX for perpetuals trading, offering high leverage, rewards, LSTfi integration and a robust multi-chain ecosystem.

 trading is one of the most lucrative areas for cryptocurrency enthusiasts if you know how to navigate the sometimes complex world of these contracts. Unlike standard futures, perpetual futures contracts have no expiration date, allowing traders to hold onto their positions as long as they prefer. You only exit a crypto perpetual (or “perp”) contract when you feel it’s the best time to execute your long or short trade. The lack of an expiration period makes these contracts attractive for traders.

Unfortunately, many crypto perpetual contract trading platforms are far from user-friendly. It seems like many perpetual crypto exchanges assume that only professional traders dabble in these contracts, and along with that assumption goes a second one — that these pros can navigate even the most complex user interfaces. As a result, finding a user-friendly perps platform is a challenge in the world of crypto trading.

 (DEX) that aims to change the status quo by providing a user-friendly environment for traders. Its platform also offers high leverage ratios, integration into the wider liquid staking token finance (LSTfi) ecosystem and generous reward programs for referrers and affiliates.

Thanks to its numerous benefits, this DEX caters to the needs of traders at all levels of expertise who are interested in crypto perpetuals. Operational since mid-2023, KiloEx launched its native token, KILO, in March 2025 to further enhance its platform's reward, staking and governance mechanisms.

 (BNB) that specializes in crypto perpetual futures trading.

 The platform prides itself on offering a user-friendly interface, high 

 ratios of up to 100x, multi-token vaults with generous APYs and a number of reward programs for referrers and affiliates.

Co-founded by Joey Ni (CEO) and Charles Gong (COO), KiloEx was originally launched on BNB Chain's mainnet in June 2023. As of mid-April 2025, the platform has additionally expanded its service coverage to five 

 (B2). This coverage allows KiloEx to access the ecosystems of three leading blockchain platforms — 

Manta, Base and Taiko are Ethereum-focused Layer 2 solutions, while opBNB is an efficient and low-cost optimistic rollup for the BNB Chain, while B

 is a platform linked to Bitcoin that acts as a major Bitcoin DeFi (BTCFi) enabler.

Because it’s a BNB-native platform, KiloEx's industry footprint is most notable within this blockchain's broader ecosystem. In fact, as Apr 17, 2025, KiloEx is the top DEX on the opBNB network by 

Using Layer 2 chains allows KiloEx to offer its users fast and low-cost transactions, which isn't always possible on a typical Layer 1 network. It's true that BNB Chain, the primary Layer 1 used by KiloEx, generally has much lower gas fees than Ethereum, the industry's leading 

 chain that’s notorious for its exorbitant costs. However, KiloEx's partner Layer 2 networks help drive costs and transaction times even lower. BNB Chain's current average gas fee is slightly over $0.10, while the opBNB Layer 2 rollup's comparable fee is only about $0.005.

In 2024, the platform introduced one of its most innovative features — the 

, which allows liquidity providers to stake multiple assets to earn high yields. That same year, KiloEx significantly expanded its partnership network, becoming an active player in the LSTFi ecosystem. LSTFi is a new stream within the DeFi industry that allows you to use 

 (LSTs) on various protocols for additional yield.

Having solidified its market presence in 2024, the project launched its native token, KILO, in March 2025. However, in mid-April 2025, KiloEx 

 and halted trading on April 15 as a risk management measure, pending investigation of the damage.

The Hybrid Vault is among the most innovative features offered by KiloEx. Essentially, it acts similarly to liquidity pools on other exchanges. Liquidity providers can contribute their crypto funds to the vault to support trading activity on the DEX and earn interest on their contributions, based on the fees earned by the protocol.

You can contribute a mix of coins to a KiloEx vault. Supported assets include 

Depending upon trading activity and the mix of coins contributed, you can earn APYs as high as 30%, making KiloEx one of the most lucrative choices for liquidity providers in this niche.

KiloEx uses a health factor calculation for this type of vault to keep your funds and the entire ecosystem safe. Based on the health factor score of your contribution to the vault, your funds could be liquidated if their value drops dangerously low.

Discounts are also offered for fixed-term deposits for established assets, such as USDT and USDC. Withdrawals for the fixed deposits are processed upon maturity, while all other withdrawals are processed within one to three "epochs," with each epoch on the platform lasting about three days. Thus, depending upon your contributed funds, you’ll wait anywhere from three to nine days to receive your crypto back.

The KiloEx platform also runs a generous referral program under which you can earn rewards for referring your friends to the platform. The amount you earn depends upon the trading volumes generated by the people whom you’ve referred. Additionally, your referees to the DEX can also benefit from fee rebates, again depending upon the volume of trade they generate.

There’s a tiered system, comprising nine levels, based on which you and your friends earn commissions and rebates. Under this system, even those referred traders whose monthly volume is at the lowest level (below $5,000) can still benefit from 5% rebates, while you also earn a 10% commission.

The table below shows the structure of this referral system with percentages for commission and rebates based on monthly trading volumes.

KiloEx offers an affiliate program for key opinion leaders (KOLs) with a certain level of social media following and influence in the crypto market. KOLs may apply to join the program by filling out an application, which is then considered by the project team within 48 hours.

To qualify for affiliate status, a KOL must have: 

Approved affiliates are provided a link to the platform, and are encouraged to invite their followers to trade on the KiloEx. If they invite at least five followers who trade at sufficient levels, the affiliates can start earning their commission. KOLs can earn up to 55% commission, depending upon the referred followers' trading activity.

KiloEx’s native utility token, KILO, is a 

 asset launched on BNB Chain. It’s used on the platform for governance, fee discounts on trades, rewards via 

, liquidity provision incentives and staking.

KILO is a supply-capped asset, with a maximum and total supply of 1 billion. The token’s supply allocation shares are shown in the chart below.

xKILO is an escrowed version of the KILO token. You can convert KILO to xKILO at a fixed rate of 1:1. The primary utility of xKILO is to provide boosted liquidity provision, which makes it possible to receive staking rewards. By locking xKILO on the platform, you can access special discounts and other benefits reserved for VIP-level users. Holding xKILO also grants you governance power to vote and influence the platform's future direction.

Unlike KILO, xKILO is nontransferable and isn’t tradable on the secondary market. The only ways to obtain xKILO are either to buy it with KILO or receive it via airdrops.

Platform users can earn points to qualify for KILO airdrops. Typically, you accumulate points by trading, depositing funds, referring others to the DEX, checking in to the platform and completing other specified eligible activities.

The project’s initial airdrop, Genesis Season, had an eligibility snapshot taken back in July 2024. Under the currently running airdrop campaign, Pioneer Season, users can earn points to receive KILO tokens for 180 days past the token generation event (TGE) in late March 2025 (i.e., until late September 2025).

Additionally, you can earn KILO tokens on Bybit simply by participating in the 

 event and holding BNB in your account. Every day at various random times, Bybit will take snapshots of your BNB holdings in your Funding and Unified Trading Accounts to calculate the number of KILO tokens you’re eligible for. The campaign will run through Apr 25, 2025, 11:59PM UTC, and you’ll have your share of KILO airdropped seven days after this date.

 market as a swap pair with USDT. If you don't have a Bybit account, you can easily 

, and access opportunities across hundreds of trading pairs and crypto products on the exchange's Spot and Derivatives markets.

As of Apr 17, 2025, the KILO token is trading at $0.039, which is 76.2% lower than its ATH of $0.1648 on Mar 27, 2025, and 17.3% higher than its ATL of $0.03344 on Apr 12, 2025.

Long-term price forecasts for KILO are mostly bullish. CoinCodex 

 at $0.0387 in 2027 and then rise to $0.135 in 2030 while PricePredictions 

When it comes to perpetuals trading, both traditional 

 (CEXs) and DEXs have often struggled to offer an intuitive trading experience. In contrast, KiloEx has made user-friendliness a cornerstone of its operations. With KiloEx, you can enjoy a streamlined trading process, access market trends info for thorough research, get an overview of the cryptocurrency market and conduct other activities via an interface that’s designed for anyone, irrespective of their familiarity with decentralized trading.

The platform also boasts a diverse range of other benefits not easily found in the world of perpetuals-based cryptocurrency trading — generous leveraged trading options, trading fee discounts, lightning-fast trades, low trading fees and an innovative Hybrid Vault system. Many of these benefits are thanks to KiloEx's collaboration with several Layer 2 decentralized platforms, which provide the technical infrastructure to enable low costs and fast order processing.

If you’re a crypto perpetuals enthusiast, KiloEx is definitely a platform to peruse.

Intermediate

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KiloEx (KILO): More than a DEX — a rewarding ecosystem

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.

Since DApp users aren’t required to provide their real identities when interacting with the apps, verifying the identities of customers can be challenging.

For starters, while these apps do away with the possibility of data breaches on centralized servers and data systems, their open-source nature does leave them vulnerable to hacks and scams. Since they’re open-source, hackers have opportunities to probe blockchains and their networks in search of weaknesses. The 

 alone cost the ecosystem $80 million in 2021.

Fortunately, as decentralized app technology continues to expand and user bases grow, the industry is taking action to make hacking blockchain networks increasingly difficult. Some of the strategies currently being worked on include smart contract debugging, eliminating copy-and-paste errors, fixing faulty app logic and implementing regular audits.

While DApp creators are taking steps to fix these issues, as more and more DeFi projects hastily launch without proper funding and auditing protocols, the hacking problem persists.

The majority of apps today operate on centralized networks owned and maintained by a controlling authority. Streaming services, social media networks and financial institutions all hold your data on servers. When accessing these apps, their servers receive a request and they send the result back to you after validating your credentials. This generates enormous amounts of user data, which results in exposure to hacks, as well as big tech companies profiting from it.

These shortcomings have led to greater data security awareness and increased interest in blockchain technology. Decentralized by nature, blockchains eliminate the need for third-party intermediaries. Thanks to automated smart contract usage and shared consensus, Ethereum-based blockchains and apps can be completely decentralized, and function without Big Tech getting in the way.

For example, if you want to send some crypto to a friend using a DApp, all you have to do is log in to your personal crypto wallet, choose the amount to send, and then confirm the transaction. A smart contract then does the rest and completes the exchange. A permanent record of the transaction is created after being verified by blockchain validators.

Centralized web apps don’t work this way. When sending U.S. dollars to a friend using 

 or another centralized web app, the process takes place on a centralized network, with a bank or other company handling every component of the transaction. Not only do they decide on the validity of the transaction, but they also own the data.

Everyone from Twitter to Trello uses web apps, but every single one consists of both a front end and a back end. For example, when you open up the Twitter app or access it on your web browser, the Twitter web server (back end) goes to work supplying data to the display feed (front end).

Web Apps vs. DApps: Further Considerations

While huge amounts of data are channeled through the internet via centralized servers, blockchains share the transactional burden with scores of machines over a distributed network. Both websites and DApps work similarly on the front end to render available pages viewable on the internet. On the back end, however, a DApp communicates with a large blockchain network via a wallet.

Your wallet is responsible for managing your blockchain address, as well as the cryptographic keys needed to verify your identity. If a DApp is Ethereum-based, a smart contract is used (rather than HTTP protocol) to communicate back and forth with the blockchain and carry out transactions.

Despite still being in its early stages, DApp technology is really taking off. Already, there are thousands of DApp solutions offering a vast array of services. From playing games to trading NFTs and investing in DeFi, you name it — and there’s a DApp for it.

, there are over two million unique daily DApp users. While this is impressive, there’s still a way to go before DApp usage outpaces that of traditional web apps.

In order for DApp usage to become more mainstream, DApp developers and the networks they’re built on must work through a lengthy list of challenges, including security and 

. When they do, however, a new era of decentralization will dominate the app landscape.

DApps are sprouting up everywhere and creating a new P2P economy free of centralized power and monopolistic companies. Just as varied as traditional web apps, they're used for everything from productivity and finance to games and entertainment. Most of these apps are hosted on the Ethereum blockchain, but as smart contract and blockchain technology in general continues to evolve, DApps stand poised to evolve right along with it.

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

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