The Future of DApps: What’s in Store for 2023

dapps future trends
Aran Davies
Blockchain Expert | Developer | Writer | Photographer

We can expect the following trends concerning the future of DApps

1. Launch of more stablecoins: An important trend vis-à-vis the future of DApps

We can expect to see more stablecoins in the future. What’s more, we might expect to see these digital currencies use innovative price-stability mechanisms. Developers creating blockchain-based decentralized applications can expect to create more apps around stablecoins.

Everyone knows how popular Bitcoin and Ether are. However, these popular cryptocurrencies witness a high degree of price volatility. Volatility in the cryptocurrency market has been a defining characteristic. Even with watershed events like the COVID-19 pandemic and other geopolitical turbulence, volatility has always accompanied the crypto market.

When you think of Bitcoin or Ether to replace fiat money as the medium of payment, you can see the impact of the crypto market volatility. Merchants and consumers alike find it hard to use these cryptocurrencies as a medium of payment. Volatility hampers the adoption of cryptocurrencies.

Stablecoins intend to solve this problem. They are cryptocurrencies built on blockchain technology. However, they try to maintain price stability.

Stablecoins might use different methods and pegging mechanisms to maintain price stability, e.g.:

  • Pegging against fiat currencies like USD and Euro;
  • Maintaining price stability by pegging against precious metals like gold;
  • Using other cryptocurrencies as collaterals to maintain price stability.

By maintaining price stability, stablecoins can attract new users to cryptocurrencies.

We can expect a new generation of decentralized apps that offer new stablecoins. Many of these decentralized applications might use the Ethereum network. They might utilize Ethereum smart contracts in novel ways to offer price stability.

MakerDAO is an example. It’s an Ethereum DApp (decentralized application). Users can use it to create Dai, a stablecoin collateralized with Ether.

2. Roll-out of more decentralized exchanges: An important trend concerning the future of decentralized apps

Decentralized exchanges (DEXs) will likely become more important. Developers of DApps can expect to create more DEXs. Let’s understand why.

While cryptocurrencies might provide all the benefits promised, they aren’t interoperable. You can’t buy a Bitcoin on the Ethereum network since the underlying technology is different for them. The blockchain-cryptocurrency ecosystem came up with centralized crypto exchanges to deal with this lack of interoperability.

Centralized crypto exchanges are just centralized applications. While users trade cryptocurrencies on them, a central authority manages these websites.

However, wasn’t the whole point of blockchain about moving to a decentralized future? Proponents of blockchain technology envisaged a censorship-resistant world outside the control of a central administrator.

They wanted to use this new technology to create an open-source ecosystem of platforms, apps, and networks without a “single point of failure” (SPOF). Blockchain-crypto enthusiasts wanted to avoid the scenario where a large company like Google controls the Internet.

Centralized crypto exchanges went against everything that blockchain promised. Therefore, blockchain/crypto developers created DEXs. DEXs are decentralized applications. Often, blockchain developers create a DEX using the Ethereum decentralized network. They code Ethereum smart contracts for this.

DEXs have become important in the larger decentralized finance (DeFi) space. Uniswap is a well-known DEX built on Ethereum. It has a high transaction volume. PancakeSwap is another DEX, and it’s built on the Binance Smart Chain (BSC). PancakeSwap has lesser transaction fees than Uniswap since the Ethereum network is more congested.

3. Decentralized crypto lending: A key trend in the decentralized applications space

Upon exploring the landscape of DApps, observers consistently highlight how crypto lending platforms are important. Blockchain developers can expect to build DApps that make a mark in the finance sector, and decentralized crypto lending platforms will be prominent among them.

Various factors limit the ability of borrowers to get loans. Limitations of traditional banks and financial services institutions are some of these factors. Paperwork-intensive lending processes compound the complexities. As a result, borrowers can’t get access to credit.

Blockchain/crypto developers have created decentralized crypto lending platforms to make loans available to such borrowers. These platforms bring lenders and borrowers from different parts of the world together. The transparency and efficiency of blockchain benefit both lenders and borrowers.

Decentralized crypto lending platforms have become important constituents in the decentralized finance (DeFi) ecosystem. Many of these DApps are built on the Ethereum blockchain network. An example is Aave, an open-source DeFi lending platform.

4. Launch of more NFT-based blockchain games: A key trend in the DApp ecosystem

NFT-based blockchain games aren’t entirely new, however, DApps in this category might become highly popular in the future.

NFTs (non-fungible tokens) are cryptographic tokens. They are unique and indivisible. You can trade a fraction of a Bitcoin, and one Bitcoin is exactly the same as another. That’s not the case with NFTs though. You can’t have a fraction of an NFT. Furthermore, an NFT represents one single entity that’s unique. No two NFTs are the same.

These characteristics make NFTs ideal for tokenizing artworks and collectibles. The same characteristics make NFTs suitable for online games with digital assets. You can create an NFT to represent one unique character or asset in your online game.

In 2017, CryptoKitties became a viral Ethereum-based NFT game DApp. Game developers have come up with much more interesting NFT game DApps since then. Axie Infinity is an example of a highly popular NFT-based game DApp.

5. Roll-out of DApps centering on the Metaverse

How the Metaverse will shape up isn’t quite clear yet. However, we can expect a lot of developments around it. The world of blockchain and DApps will see a lot of development around the Metaverse too.

Many experts believe that users on the Metaverse will use cryptocurrencies to buy and sell goods and services. This would require the Metaverse infrastructure to integrate blockchain.

We can expect plenty of Metaverse-related data stored on the blockchain. Since the Metaverse will involve financial transactions, we will face the question of securing the personal details of users. That highlights the importance of security features of blockchain, private keys, data encryption, etc.

DApp developers should expect to create apps with a heavy focus on the Metaverse. This could include the development of DAOs (Decentralized Autonomous Organizations) and NFTs. AlienWorlds is an example of a Metaverse-themed game. It’s a blockchain-based DApp connected to both Ethereum and BSC.

Planning to build a DApp? Contact DevTeam.Space to hire competent blockchain developers with DApp development experience.

FAQs on the Future of DApps

What is the future of DApps?

It is unlikely that DApps will replace centralized applications. That said, decentralized apps have a number of advantages that will see them replace some centralized applications in the very near future. Only time will tell how many that will be.

How many DApps are there?

There are 1,000s of DApps both in use and under development.

What is DApps Blockchain?

These are decentralized applications that run on the blockchain rather than on a server system owned or controlled by one central power.

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