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What is a Dapp and How Does it Use Smart Contracts?

dApps or decentralized applications are applications powered by a public blockchain protocol like Ethereum. When you build a dApp on Ethereum, you’re programming a simple set of rules for an application to follow when it receives money or other inputs from users.

Smart contracts are a lot like programming a robot. Smart contracts on a blockchain, like the kinds powering the most popular apps in DeFi, are often used for money applications to put funds to work without interacting with a bank and other intermediaries.

These robots help money grow by following a strict set of rules programmed on the blockchain. Smart contracts blockchains like Ethereum enable trustless interactions, enabling users to do new and interesting things with money, without having to trust humans or centralized entites.

Smar contracts will do exactly what they’re progrmmed to do, and it they won’t care where you come from and what your credit score is. They only care that you pay up. Each transaction has a cost, and as long as you pay it, these money robots will keep working.

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