APIs are a crucial part of the digital economy infrastructure.</p>\n<p>Decentralized APIs (dAPIs) are developed using <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-blockchain/">blockchain technology</strong></a>. DAPIs are utilized to create <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-are-decentralized-applications-dapps/">decentralized apps (dApps)</strong></a> and platforms that work on decentralized systems.</p>\n<p>Digital companies use APIs to provide their services and data as marketable service modules that can then be integrated into apps. The use of APIs helps optimize software development and makes it more efficient.</p>\n<p>Many APIs are <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-centralized/">centralized by design and are referred to as legacy APIs. Centralized APIs are not inherently compliant with blockchain technology, although they otherwise function similarly to dAPIs. The differences between centralized and decentralized APIs related to the API gateway and be easily identified.</p>\n<p>An API gateway is a management tool that acts as a reverse proxy. It accepts client requests and returns the fulfilled services. In a decentralized system, the API gateway redirects the client queries to other API endpoints.</p>\n<p>These endpoints can be an application&rsquo;s backend or a public API of the app&rsquo;s trading partner. The protocol, data conversions, and security measures are handled by the API gateway at runtime.</p>\n<p>In a centralized system, all data is gathered in the section of the API platform known as the central data store. The central data store maintains a near real-time bi-directional synchronization with linked backend apps and business partners via <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-asynchronous/">asynchronous connections</strong></strong></a>. The API queries are directed to the central data storage.</p>\n<h2>The Oracle Problem</h2>\n<p>The oracle problem is a phenomenon of <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-decentralized-network/">decentralized networks</strong></a>. <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-smart-contract/">Smart contracts</strong></a> distributed on blockchain networks are unable to obtain data that is not readily available on the blockchain.</p>\n<p>Therefore, smart contracts cannot directly access APIs from the blockchain in which they are stored. This is due to the unique consensus-based security assurances granted by using a decentralized node network as the app platform.</p>\n<p>The solution to the oracle problem must allow smart contracts to access API data and simultaneously maintain the security assurances of the system to their full extent without creating new attack surfaces.</p>\n<p>This problem can be solved by using decentralized API services to manage various data providers. This solution is viable as they are blockchain-based by design.</p>\n<p>Unlike the decentralized application programming interfaces, existing decentralized oracles do not include the data source API as part of their solution. Decentralized APIs can provide <strong>a higher degree of data transparency</strong> than decentralized oracles, reaching as far as the true data source level.</p>","level":"medium","meta_title":"What is Decentralized API (dAPI)? 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Have?","featured_image_id":10729,"status":"published","chapter_id":7,"language":"en","order":2,"modified_content":null,"preview_url":"https://www.bitdegree.org/crypto/learn/how-to-invest-in-crypto","featured_image":{"id":10729,"uuid":"3439a1db-9892-404a-b4b6-a1db5a34bca4","public_url":"https://assets.bitdegree.org/crypto/storage/optimized/how-to-invest-in-crypto-featured-image.jpg","path":"crypto/storage/optimized/how-to-invest-in-crypto-featured-image.jpg","original_path":"crypto/storage/original/how-to-invest-in-crypto-featured-image.jpg","name":"how-to-invest-in-crypto-featured-image.jpg","original_name":"how-to-invest-in-crypto-featured-image.jpg","title":null,"alt":null,"width":1024,"height":576,"disk":"spaces","status":"uploaded","readable_file_size":"75.22KB"},"youtube_video":null},{"slug":"ico-vs-ido","title":"ICO vs IDO vs IEO: Which One is the 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Assets?","featured_image_id":6542,"status":"published","chapter_id":7,"language":"en","order":5,"modified_content":null,"preview_url":"https://www.bitdegree.org/crypto/learn/how-to-get-free-crypto","featured_image":{"id":6542,"uuid":"4fceb9ab-391e-4ef9-b00d-c871a49878a3","public_url":"https://assets.bitdegree.org/crypto/storage/media/how-to-get-free-crypto.o.jpg","path":"crypto/storage/media/how-to-get-free-crypto.o.jpg","original_path":"crypto/storage/media/how-to-get-free-crypto.jpg","name":"how-to-get-free-crypto.o.jpg","original_name":"how-to-get-free-crypto.jpg","title":null,"alt":null,"width":768,"height":478,"disk":"spaces","status":"uploaded","readable_file_size":"93.93KB"},"youtube_video":null},{"slug":"how-to-arbitrage-crypto","title":"What is Crypto Arbitrage: The Main 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Risks?","featured_image_id":null,"status":"published","chapter_id":7,"language":"en","order":8,"modified_content":null,"preview_url":"https://www.bitdegree.org/crypto/learn/investing-in-cryptocurrency","featured_image":null,"youtube_video":null},{"slug":"what-is-a-rug-pull-in-crypto","title":"What is a Rug Pull in Crypto?","featured_image_id":6532,"status":"published","chapter_id":7,"language":"en","order":9,"modified_content":null,"preview_url":"https://www.bitdegree.org/crypto/learn/what-is-a-rug-pull-in-crypto","featured_image":{"id":6532,"uuid":"be8043fb-078c-4487-9af9-d2d9c2b574ea","public_url":"https://assets.bitdegree.org/crypto/storage/media/what-is-a-rug-pull-in-crypto.o.jpg","path":"crypto/storage/media/what-is-a-rug-pull-in-crypto.o.jpg","original_path":"crypto/storage/media/what-is-a-rug-pull-in-crypto.jpg","name":"what-is-a-rug-pull-in-crypto.o.jpg","original_name":"what-is-a-rug-pull-in-crypto.jpg","title":null,"alt":null,"width":768,"height":478,"disk":"spaces","status":"uploaded","readable_file_size":"92.28KB"},"youtube_video":null},{"slug":"how-to-avoid-rug-pulls-in-crypto","title":"How to Spot and Avoid Rug 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Taxes","featured_image_id":6526,"status":"published","chapter_id":7,"language":"en","order":11,"modified_content":null,"preview_url":"https://www.bitdegree.org/crypto/learn/how-to-avoid-crypto-taxes","featured_image":{"id":6526,"uuid":"1e44162c-ef1d-4010-81b4-9e8d1809aedf","public_url":"https://assets.bitdegree.org/crypto/storage/media/how-to-avoid-crypto-taxes.o.jpg","path":"crypto/storage/media/how-to-avoid-crypto-taxes.o.jpg","original_path":"crypto/storage/media/how-to-avoid-crypto-taxes.jpg","name":"how-to-avoid-crypto-taxes.o.jpg","original_name":"how-to-avoid-crypto-taxes.jpg","title":null,"alt":null,"width":768,"height":478,"disk":"spaces","status":"uploaded","readable_file_size":"99.10KB"},"youtube_video":null}]},{"id":8,"title":"Crypto Analysis","slug":"crypto-analysis","updated":null,"chapter":"https://assets.bitdegree.org/crypto/assets/crypto-book/chapters/learn-crypto-analysis.jpg","chapter_simple":"https://assets.bitdegree.org/crypto/assets/crypto-book/chapters-simple/crypto-analysis-101.jpg","rating":100,"sections":[{"slug":"what-is-bullish-and-bearish","title":"Bearish and Bullish Markets: Do They Matter?","featured_image_id":null,"status":"published","chapter_id":8,"language":"en","order":1,"modified_content":null,"preview_url":"https://www.bitdegree.org/crypto/learn/what-is-bullish-and-bearish","featured_image":null,"youtube_video":null},{"slug":"best-technical-analysis-indicators-for-crypto","title":"5 Best Crypto Technical Analysis Indicators You Must Know About","featured_image_id":null,"status":"published","chapter_id":8,"language":"en","order":2,"modified_content":null,"preview_url":"https://www.bitdegree.org/crypto/learn/best-technical-analysis-indicators-for-crypto","featured_image":null,"youtube_video":null},{"slug":"what-is-candlesticks","title":"Technical Analysis: What are Candlesticks, Trendlines, and Patterns?","featured_image_id":null,"status":"published","chapter_id":8,"language":"en","order":3,"modified_content":null,"preview_url":"https://www.bitdegree.org/crypto/learn/what-is-candlesticks","featured_image":null,"youtube_video":null},{"slug":"how-to-track-new-crypto-coins","title":"Crypto Tracking: How to Track Your Favorite Coins & Tokens?","featured_image_id":null,"status":"published","chapter_id":8,"language":"en","order":4,"modified_content":null,"preview_url":"https://www.bitdegree.org/crypto/learn/how-to-track-new-crypto-coins","featured_image":null,"youtube_video":null},{"slug":"how-to-research-crypto","title":"Crypto Research Fundamentals & Social Signals: Your Daily Trading Strategy","featured_image_id":null,"status":"published","chapter_id":8,"language":"en","order":5,"modified_content":null,"preview_url":"https://www.bitdegree.org/crypto/learn/how-to-research-crypto","featured_image":null,"youtube_video":null}]},{"id":9,"title":"Mining","slug":"mining","updated":false,"chapter":"https://assets.bitdegree.org/crypto/assets/crypto-book/chapters/learn-crypto-mining.jpg","chapter_simple":"https://assets.bitdegree.org/crypto/assets/crypto-book/chapters-simple/crypto-mining-101.jpg","rating":80,"sections":[]},{"id":10,"title":"Crypto Terms","updated":false,"chapter":"https://assets.bitdegree.org/crypto/assets/crypto-book/chapters/crypto-101-glossary.jpg","chapter_simple":"https://assets.bitdegree.org/crypto/assets/crypto-book/chapters-simple/crypto-glossary-101.jpg","rating":100,"sections":["A","B","C","D","E","F","G","H","I","J","K","L","M","N","O","P","Q","R","S","T","U","V","W","X","Y","Z"]}],"nextSection":{"id":228,"original_id":null,"author_id":41,"translator_id":null,"title":"What is DAO Summoning?","slug":"what-is-dao-summoning","section":"D","keyword":"DAO Summoning","status":"published","definition":"the creation of a decentralized autonomous organization (DAO).","content":"<p><strong>DAO summoning</strong> refers to the act of forming a new <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-are-decentralized-autonomous-organizations-dao/">decentralized autonomous organization (DAO)</strong></a>. While the term can apply to the creation of any new DAO, it is most often used when talking about <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-moloch-dao/">Moloch DAO</strong></a>.</p>\n<p>Moloch DAO was the first decentralized autonomous organization to be summoned. The summoning was initiated by Ameen Soleimany on February 14th, 2019, <strong>at the ETHDenver event</strong>.</p>\n<p>The process of DAO summoning is fast, as the infrastructure can be deployed in a few seconds using tools that have been developed to optimize the process.</p>\n<p>Summoning refers to the urgency of creating a new DAO by bringing the community together to work on a collective purpose, <strong>nurture the same values</strong>, and share the ownership of the fundamental idea of the DAO.</p>\n<p>The choice of vocabulary is a deliberate contract to the terminology used to describe new formations of traditional companies which are not community-driven and instead are corporate-owned. In this case, more utilitarian vocabulary such as <strong>&ldquo;fund&rdquo;</strong> or &ldquo;start&rdquo; is used.</p>\n<p>DAO summoning can also be used to describe the process of assembling the new members of a newly established DAO. The entity in the role of the DAO summoner calls on the community members to join the organization. This leads to the first cohort of DAO members.</p>\n<p>The early versions of the Moloch DAO framework established that <strong>the DAO summoner was the only initial member of the organization in its infancy</strong>. This led to the requirement to bring new members into the organization.</p>\n<p>Starting with version 2.1 of the Moloch DAO framework, multiple initial members have been granted permission to summon a new DAO. This process is referred to as &ldquo;multi-summoning&rdquo;.</p>","level":"easy","meta_title":"What is DAO Summoning? Definition & Meaning | Crypto Wiki","meta_description":"DAO Summoning meaning: DAO Summoning - the creation of a decentralized autonomous organization (DAO).","meta_keywords":null,"language":"en","created_at":"2022-03-01T09:43:16.000000Z","updated_at":"2022-05-13T14:32:23.000000Z","preview_url":"https://www.bitdegree.org/crypto/learn/crypto-terms/what-is-dao-summoning"},"prevSection":{"id":9204,"original_id":null,"author_id":42,"translator_id":null,"title":"What is Crypto Gambling?","slug":"what-is-crypto-gambling","section":"C","keyword":"Crypto Gambling","status":"published","definition":"a form of online gambling that is based on smart contracts and uses cryptocurrencies as a means of payment.","content":"<p>In a way, crypto gambling is similar to traditional gambling. However, instead of fiat currencies, <strong>crypto gambling uses cryptocurrencies</strong>. In addition to that, unlike traditional gambling, crypto gambling provides players with a provably fair gambling process due to the <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/learn/crypto-terms/what-is-smart-contract/">smart contracts</strong></a> used to define the regulations of the game.</p>\n<p>The rules of the game and the odds of winning are both included in the regulations outlined by smart contracts. In traditional gambling, on the other hand, players typically have no idea of the algorithms used in the game, nor do they have any idea of their odds of winning or losing. Thus, this often leads to players getting manipulated into falling for scams.</p>\n<p>Getting back to crypto gambling, since <strong>smart contracts cannot be changed once they are set in motion</strong>, players can be sure that no rules will be changed once they start playing the game. Besides that, all smart contracts are publically stored on the blockchain, which means that anyone can view them anytime.</p>\n<p>Now, it's also worth noting that there are two types of gambling platforms &ndash; <strong>centralized and decentralized</strong>. Centralized gambling platforms work pretty much the same as traditional gambling. Thus, when talking about crypto gambling, people usually refer to decentralized crypto gambling platforms.</p>\n<p>Speaking of which, there are a number of advantages that decentralized cryptocurrency gambling platforms have over conventional gambling platforms. For example, let's take <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/coingames/" target=\"_blank\" rel=\"nofollow noindex noopener\"><strong>CoinGames</strong></a>, which is a well-known online decentralized gambling casino.</p>\n<p>Just like other decentralized gambling platforms, <strong>CoinGames is</strong> <strong>non-custodial</strong>. In other words, the platform is not the owner of the user's funds. Instead, the aforementioned smart contracts are in charge of holding them. These smart contracts hold the funds until the game is finished. Then, if the player wins the game, the funds are released to them (or kept in the smart contract if they lose).</p>\n<p>Additionally, since <strong>smart contracts can be publicly viewed on the blockchain</strong> by anyone, people are able to look into them in order to see how the platform in question operates and how many other players succeeded or lost. This way, it's easier for users to decide if the platform is worthwhile of their time and money, or not.</p>\n<p>Now, the last thing that needs to be addressed is whether decentralized gambling platforms like CoinGames are legal or not. Although there is no clear-cut response, <strong>these platforms are typically legal in nations and states where gambling is generally accepted</strong>.</p>","level":"easy","meta_title":"What is Crypto Gambling? Definition & Meaning | Crypto Wiki","meta_description":"Crypto Gambling meaning: Crypto Gambling - a form of online gambling that is based on smart contracts and uses cryptocurrencies as a means of payment.","meta_keywords":null,"language":"en","created_at":"2023-03-14T06:38:59.000000Z","updated_at":"2023-03-14T11:15:52.000000Z","preview_url":"https://www.bitdegree.org/crypto/learn/crypto-terms/what-is-crypto-gambling"},"currentChapter":"D","currentSection":"what-is-decentralized-api-dapi","chapterTitle":"D","readingLevel":"medium"},"url":"/crypto/learn/crypto-terms/what-is-decentralized-api-dapi","version":"cdd198d50cbe5c9c21c9329d7c096ffc"}" class="container-fluid d-flex crypto-book p-0">
Handbook Cover Page
Crypto Terms: Letter D

What is Decentralized API (dAPI)?

Decentralized API (dAPI) MEANING:
Decentralized API (dAPI) - decentralized application programming interface. A blockchain-based API service.
Medium
2 minutes

Let's find out Decentralized API (dAPI) meaning, definition in crypto, what is Decentralized API (dAPI), and all other detailed facts.

A decentralized Application Programming Interface (API) is a digital solution that enables data and service transmission between mobile and web applications. APIs are a crucial part of the digital economy infrastructure.

Decentralized APIs (dAPIs) are developed using blockchain technology. DAPIs are utilized to create decentralized apps (dApps) and platforms that work on decentralized systems.

Digital companies use APIs to provide their services and data as marketable service modules that can then be integrated into apps. The use of APIs helps optimize software development and makes it more efficient.

Many APIs are centralized by design and are referred to as legacy APIs. Centralized APIs are not inherently compliant with blockchain technology, although they otherwise function similarly to dAPIs. The differences between centralized and decentralized APIs related to the API gateway and be easily identified.

An API gateway is a management tool that acts as a reverse proxy. It accepts client requests and returns the fulfilled services. In a decentralized system, the API gateway redirects the client queries to other API endpoints.

These endpoints can be an application’s backend or a public API of the app’s trading partner. The protocol, data conversions, and security measures are handled by the API gateway at runtime.

In a centralized system, all data is gathered in the section of the API platform known as the central data store. The central data store maintains a near real-time bi-directional synchronization with linked backend apps and business partners via asynchronous connections. The API queries are directed to the central data storage.

The Oracle Problem

The oracle problem is a phenomenon of decentralized networks. Smart contracts distributed on blockchain networks are unable to obtain data that is not readily available on the blockchain.

Therefore, smart contracts cannot directly access APIs from the blockchain in which they are stored. This is due to the unique consensus-based security assurances granted by using a decentralized node network as the app platform.

The solution to the oracle problem must allow smart contracts to access API data and simultaneously maintain the security assurances of the system to their full extent without creating new attack surfaces.

This problem can be solved by using decentralized API services to manage various data providers. This solution is viable as they are blockchain-based by design.

Unlike the decentralized application programming interfaces, existing decentralized oracles do not include the data source API as part of their solution. Decentralized APIs can provide a higher degree of data transparency than decentralized oracles, reaching as far as the true data source level.
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