A decentralized application (dApp) is a program where there is no single authority that maintains the state and processes transactions.

An application stores some information, or state. You can interact with the application by performing a transaction. Transactions change the state of the application or cause a state transition. Applications also allow users to retrieve information about the state (query it) without modifying it. Let’s look at Aave through the lens of decentralized applications.

Aave is a decentralized lending application built atop a blockchain. The state of the application is a record of who has how many AVAX. The state is stored on Avalanche’s® blockchain. In this case, the entries in the blockchain ledger are something like “Alice lends Bob 1 AVAX” or “Jasmine pays Tosha 2 AVAX.” Each transaction causes a state transition by adding a new entry to the ledger. Avalanche is decentralized because many independent validators maintain the blockchain, which holds its state, and processes transactions.

For any additional questions, please view our other knowledge base articles or contact a support team member via the chat button. Examples are for illustrative purposes only.