How to create a Web3 application?

What is a Web3 application?

It is believed that Web3 can be just as disruptive and add up to a significant paradigm shift as its predecessor. Built on the foundation of decentralisation and openness, Web3 is about enabling users a greater control over their data and privacy as well as more customised experiences and applications. 

If you are not familiar with the Web3 concept, we suggest reading this article first: 'What is Web3?'.

Although the new Internet is still in the early stages of development, Web3 applications are becoming more popular among users and developers. 

What exactly is a Web3 application? Web3 applications, also known as decentralised applications or Dapps, refer to apps built on decentralised blockchain networks. 

Web3 apps can be created on various blockchains. Typically, they consist of a front-end user interface that interacts with the back-end through smart contracts and blockchain protocols. 

Most popular examples of Web3 applications include decentralised finance (DeFi) applications, NFT marketplaces, supply chain management systems, decentralised social media platforms, predictive market, and gaming applications as well as decentralised exchanges (DEXs) and decentralised data storage. 

As digital innovations and the popularity of digital assets grow, the Web3 concept is becoming more adopted among users. This may be an exciting time to develop decentralised applications. If you want to find out the basics of creating a Web3 app, keep on reading.

What is the main role of Web3 applications in the blockchain space?

Web3 apps enhance digital interactions within the blockchain space. Aside from enabling direct user transactions, Web3 applications ensure decentralisation and foster privacy as well as user autonomy.  

Their main purpose is to improve interoperability by connecting different platforms and enabling community governance and decision-making processes.  

What is the role of community in Web3? To learn more about the power of users, why not read this article: 'Is community the key to Web3 adoption?'.

There are many utilities of Web3 applications, but their main objective is to redefine digital systems and make them more decentralised, transparent, and efficient.

How does a Web3 app work?

Blockchains function differently than traditional web servers. All of the data and code on the blockchain is in a decentralised manner, distributed across a decentralised network of nodes. Therefore, it doesn’t rely on a central web server. 

Data is situated in record bundles called blocks; blocks are chained together and represent a public ledger. The main duty of nodes distributed across the network is to ensure security and immutability of data. 

To connect to the blockchain and use it, users can either run a node or connect to a node. 

Web3 apps seamlessly interact with various blockchain networks, enhancing a more connected digital ecosystem while ensuring data integrity and safe user interactions.

Blockchains are built to prevent the ‘double spending’ problem, and thereby, a new Internet based on blockchain technology has the potential to make it harder to control or manipulate data in any manner. The decentralisation of data removes the need for a central authority and gatekeeper, making it possible for anyone to access the Internet. 

Blockchain technology and the crypto ecosystem managed to successfully deal with the double spend issue. To find out how, we suggest reading this article: 'Why do we even need crypto?'.

For example, a Web3 application can be a peer-to-peer payment application based on blockchain technology; instead of going through a bank, users could pay through a Dapp. Before the transaction is approved and finalised, it would have to be checked and verified by the network and coded into the ledger. 

While this is a simple guide to creating Web3 applications, keep in mind that technical knowledge is a must. Web3 programmers develop decentralised protocols and applications, along with other Web3 technologies. 

If you are new to the blockchain technology space, it would be best to start with basics. Visit our Learn Crypto Academy to find out more.

The path of the niche

The Web3 niche is currently witnessing growth and adoption. Aside from the projected growth of the global blockchain market, DeFi has been growing exponentially as well, with a total value locked (TVL) at over $200 million.  

Although Web3 is still in its early stages, it has been stated that more than 200 million crypto users are using Web3 applications. Along with the growing acceptance of Ethereum, a blockchain ecosystem hosting the majority of NFT and DeFi projects, the surge of Web3 apps demonstrates a more mainstream adoption. 

This niche is also characterised by community governance since Web3 projects highlight the importance of increased user participation through the governance tokens’ mechanism, enabling token holders to influence the decision-making process of a particular Web3 project. 

That brings us right to decentralised autonomous organisations (DAOs) which embody principles of the new Internet and are growing in numbers. Like Web3, DAOs present a paradigm shift in organisational structures, removing the hierarchy and giving decision-making power to the users.

How is DAO helping scientists and solving the issue of underfunding? To learn more, take a look at this article: 'DAOs helping scientists: Underfunding solved by decentralisation'. 

Finally, the crypto world is plagued with energy efficiency concerns. For many years, the environmental impact of blockchain, specifically the Proof-of-Work (PoW) consensus mechanism has been at the centre of many environmental debates. Therefore, many Web3 projects have engaged with finding eco-friendly alternatives. 

To conclude, the Web3 niche is an umbrella term for technologies such as blockchain technology that decentralises data and digital assets as well as control over the Internet. Since most Web2 applications are under centralised control that determines how to store and use user data, Web3 is more about community-driven projects.

Decentralised applications (Dapps) leverage blockchain technology and smart contracts to provide a wide range of services, from decentralised storage solutions, decentralised social networks to finance and decentralised identity and beyond.

To find out more about Web3 crypto projects, check out this article: 'What are the biggest Web3 crypto projects?'.

Key features of developing a Web3 application

Creating a Web3 application includes several key features that define its user-centric nature. Primarily, it is important to implement a decentralised network structure and avoid reliance on any central authority. Keep in mind that transparency and security are the cornerstones of the new Internet. 

Aside from smart contracts used to automate processes and execute agreements, don’t forget to leverage tokenization and represent digital assets, along with an efficient mechanism for determining ownership and value exchange. 

That said, remember that community might be the key to Web3 adoption. Integrating a user-centric governance model is in line with basic principles of the Web3 environment. 

A Web3 application should be designed for interoperability. It should be able to enable communication with divergent blockchain networks and protocols. 

Think of decentralised identity and decentralised storage solutions to enable users to control their assets and digital identities in a secure manner. Always remember to prioritise robust security measures and provide a high level of data protection within the ecosystem. 

What are smart contracts?

Smart contracts are like the digital and decentralised equivalent of traditional legal agreements. These represent digitally enforceable agreements with a wide range of utilities, such as automation, transparency and simplifying complex operations. 

A smart contract can be defined as a self-executing contract with terms written into lines of code. The main objective of smart contracts is to enhance security and reduce costs associated with transactions.

A smart contract’s code encompasses a set of predefined rules. This can be just one person sending money to another or include more complex legal situations with multiple parties and obligations. 

The Web3 ecosystem provides all necessary frameworks for testing and deploying smart contracts. Keep in mind that more complex smart contracts may take time to develop and test. While planning smart contract development, take into account your project budget and availability.

What do smart contracts do?

As mentioned above, smart contracts simplify complex business operations and provide an additional level of security.

Smart contracts have fundamentally altered the landscape of digital transactions and agreements, offering a plethora of benefits over traditional contract forms. 

Once a smart contract has been deployed, it cannot be changed- therefore, it eliminates the risks of manipulation and fraud. In contrast to traditional agreements, they are more cost-effective and reduce costs. A peer-to-peer transaction structure saves money and time. 

Since complicated business logic can be incorporated into smart contracts, they provide a wide array of use cases within multiple industries. Digital and automated self-executing contracts reduce the risk of human error that can happen during manual preparations. 

However, testing smart contracts is significant because you need to ensure that they function properly before going live on the blockchain. Once you deploy smart contracts on a decentralised network, they cannot be altered.

Advantages of Web3 Dapps

Web3 applications offer various benefits. Since they are based on blockchain technology and decentralised data storage, Web3 apps ensure data integrity and reduce the risk of cyber-attacks. 

Due to the main features of blockchain technology and Web3 ethos, users have more control over their data and digital assets and a higher degree of privacy. The community-driven approach of the Web3 ecosystem enhances inclusivity and expands the user base. 

Furthermore, smart contracts add up to automated processes and increase transparency of transactions with lower costs. Cross-border transactions are faster and more secure than traditional transactions conducted by intermediaries such as banks. 

Finally, Web3 applications enhance innovation and provide various monetization strategies for their creators such as subscription models and tokenization. 

Disadvantages of Web3 Dapps

On the other hand, you should be aware of certain challenges and limitations of Web3 applications. First, Web3 still presents new territory which can be impacted by regulatory changes or global events.  

Because of the decentralised nature of such applications, there might be some performance issues along the way. The crypto space often deals with the scalability problem, and even though many solutions are being developed, fluctuations still might happen. 

Distributed applications of Web3 can be resource intensive, meaning that they require certain technology requirements and cannot run on older hardware. 

There might be a lack of interoperability with Web2 as well- while the decentralised Internet presents a paradigm shift, web users are likely to continue using both versions of the Internet for some time.

Build a Web3 application

Here's a brief guide on how to create a Web3 app and several steps you should be aware of.

Set out the dependencies

If you want to create a Web3 application, there are various dependencies you need to install to interact with the blockchain network. 

For example, for interacting with the Ethereum blockchain, you will need to install Truffle, Ganache, NPM, MetaMask and others. Depending on your specific project requirements, there might be other packages you should be aware of. 

For example, Ganache serves as a personal blockchain or a local development environment that can be used to mirror the behaviour of a public blockchain. It enables users to deploy smart contracts, run tests and develop applications.

Develop a smart contract code

Smart contract development is a crucial element of the Web3 application development process. Choose a programming language first.  

The most popular programming language for Ethereum smart contract development is Solidity. The next thing you must do is to write smart contract code which requires a higher level of technical knowledge.

Set-up migration

The next step is setting up migration. The migration process ensures that the created smart contracts are accurately deployed and configured on the blockchain network. 

First, you need to create a migration contract that includes functions to deploy smart contracts and configure them in accordance with all required parameters.  

Secondly, you need to write migration scripts that include calls to the migration contract’s deployment functions.  

When you run the migration scripts, test the deployment to make sure that the created smart contracts are configured and deployed in a correct manner.

Compiling & deploying smart contracts

Once the smart contract code has been written, the next step is to compile it into bytecode and execute on the blockchain network. Keep in mind that you should test it to make sure that everything functions properly and then deploy to the blockchain network. 

Front-end connection

Now we are down to the connection of the front-end and smart contract. The front-end refers to the face of the Web3 application users can see and interact with, and the created smart contract makes sure that the Web3 applications function properly on the Web3 network. 

This can be done by choosing a front-end framework, and connecting it to the blockchain network by specifying required parameters such as provider URL, network ID, and others.

Then you can load your smart contract by specifying configuration parameters and interact with it by calling its functions. Update the front-end user interface to display smart contract data accordingly.

What are no-code tools in the Web3 development environment?

Remember how we said that for creating Web3 applications you need a decent level of technical knowledge? Well, that’s for sure, but there are also available Web3 no-code tools that enable individuals and companies to develop Web3 apps on the blockchain. 

Unlike traditional software development, no-code tools utilise a visual interface that enables people to create blockchain applications more easily. 

Key features of a no-code blockchain platform

These Web3 no-code platforms offer simple drag-and-drop interfaces. Users can arrange pre-built components and design their decentralised applications, along with a set of smart contract templates. 

Typically, such platforms are made to function with multiple blockchain networks so users can choose which blockchain is best for their Web3 project.  

These platforms are usually integrated with a decentralised data storage solution which enables users to store their data on the blockchain. 

Finally, they generally provide the ability to create and administer tokens as well, either cryptocurrencies as fungible tokens or non-fungible tokens (NFTs) that present unique digital assets. 

Are there any drawbacks?

While Web3 no-code platforms enhance the development of applications by making it possible for users with only little technical knowledge to create apps, there are certain drawbacks that should be considered.  

The convenience of these platforms is limited; they don’t have the capacity to handle complex projects or requirements that require a higher level of technical knowledge. 

Additionally, their capacity can be limited when it comes to implementing, for example, third-party services or certain complex functionalities. Due to pre-built components that might not be properly managed, no-code applications can be susceptible to cyber-attacks.