HomeCryptocurrencyBitcoinHow Blockstack Uses Bitcoin as the Base for Their Decentralized App Ecosystem

How Blockstack Uses Bitcoin as the Base for Their Decentralized App Ecosystem


Blockstack is a new ecosystem of decentralized applications (dapps), which allow users to store their own data locally and connect with one another in a direct, encrypted manner. On the latest episode of “The Bitcoin Game,” Blockstack Co-founder Ryan Shea explained how this new ecosystem of dapps works and why it’s important.

“We’re taking a look at how the internet has become so consolidated,” said Shea. “We’re so reliant upon a very small set of companies, and there are so many external dependencies. We essentially are reliant upon Facebook, Google and Amazon just to use the internet. In a sense, they are the internet.

“They are the lords, and we are the serfs,” Shea added.

According to Shea, the original vision of the internet was much more decentralized than how it is structured today. Instead of everyone hosting their own servers, merchants sell their products on Amazon and individuals post their social updates to Facebook. According to some polls, many Facebook users don’t even realize they’re using the internet.

With so much internet traffic going through a few major portals, Shea said there are a number of concerns related to security, monopoly power and innovation that can arise. In his view, it is important for everyone to control their own safety and freedom on the internet.

“At the end of the day, each of us want to be able to control our own experiences, we want to know that we’re safe and in control and free — whether it’s on the internet or any aspect of our lives,” said Shea.

Blockstack’s ecosystem of dapps is an attempt to redecentralize the internet and bring it back to its roots.

The Concept of Decentralized Applications

Dapps built on top of Blockstack essentially put users in control of their own data and force them to take responsibility for their own security instead of outsourcing it to a third party.

“[Applications run] locally,” said Shea. “If you do that, I do that, and we’re friends with each other on this application, then I can send you a message and it will get sent directly to you and won’t require any other third parties for the message to go through.”

Blockstack uses a new domain name system (DNS) built on top of the Bitcoin blockchain as the basis for these dapps. The DNS allows users to attach information to identities stored on the blockchain. The decentralized DNS allows users to communicate and connect with one another in a direct, secure and encrypted manner.

The heavy reliance on this new, decentralized DNS means users will need to be able to protect their own private keys. According to Shea, Blockstack is working on a variety of user-friendly key management solutions involving multifactor authentication and hardware wallets.

In addition to storing data locally, Blockstack users can also back up their encrypted application data on any cloud storage provider, from traditional solutions like Dropbox to new alternatives such as Storj.

Specifics Examples of Decentralized Applications

According to Shea, developers are building a variety of applications on top of Blockstack right now, including a decentralized alternative to Twitter.

“A P2P social network can exist, and the key to that is allowing each user to control their experience on their own local device and then helping users connect to one another so they can discover each other’s content,” said Shea.

Shea also had high praise for OpenBazaar, which is a decentralized e-commerce platform that uses Blockstack’s DNS for user names and bitcoin for payments.

“They are the future of commerce,” Shea said of OpenBazaar.

Shea is also of the belief that some method of indexing and parsing data on Blockstack’s new, decentralized version of the internet will emerge, which would be similar to what Google has done on the traditional internet.

“Some decentralized network will grow to compete in some way with Google; that’s my prediction,” said Shea.

Thoughts on Ethereum

Right now, the dapps that are gaining the most attention are the ones launching initial coin offerings (ICOs) on top of Ethereum rather than building on top of Blockstack.

Shea claimed he is “really intrigued” by Ethereum and thinks “very interesting things are being built on top of it,” but he’s also concerned with some of the issues they’ll face over the long term. “I’m concerned about remote code execution,” he said. “I’m concerned about the general philosophy of putting a large amount of logic on the chain, but I think it’s been a great platform where there’s been a lot of prototyping going on.”

In contrast to most dapps built on Ethereum, Blockstack dapps only utilize a blockchain for the naming layer. “Everything else is off the blockchain,” said Shea.

“Blockstack is blockchain agnostic,” Shea clarified. “Our philosophy is to operate on as many blockchains as possible but, whenever we can, rely upon the most secure and stable blockchain platform. Right now, that’s the Bitcoin blockchain.”


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