Also known as application-specific blockchains, appchains are specialized blockchains designed for specific applications. In other words, an appchain is a dedicated blockchain that only serves a specific application. This is a remarkable difference from public blockchains that accommodate many applications. Appchains allow the developers to control the core infrastructure of the system including governance structure, consensus mechanism, and security features. The main purpose of appchains is the flexibility and freedom that developers have, giving them the chance to build sustainable, efficient, and scalable systems.

Advantages of Using Appchains

In more detail, the following are the benefits of using appchains:

1) Scalability: Appchains can allow blockchain applications to achieve the scalability that was previously unimaginable. Because applications built on appchains don’t have to compete for block space, they result in improved performance and better throughput. More users can seamlessly use the application because there is reduced congestion, unlike the case of applications hosted on public blockchains.

2) Interoperability: Appchains allow developers to develop applications that can communicate and exchange value within the broader blockchain ecosystem. Because of the customizability that appchains offer, applications can choose which ecosystem player to interact with, enhancing usability and security.

3) Customization: Appchains give developers the creativity and freedom to tailor-make their applications. They do not have to rely on the resources of public blockchains before building their own, enhancing flexibility and innovation. With appchains, developers can choose their preferred governance structure, consensus mechanism, and economic models without relying on any third-party systems.

4) Innovation: It is easier to innovate on appchains than any other blockchain type because of the freedom they provide. Since they do not rely on the main blockchain to function, developers can try new things, leading to better innovations.

5) Efficiency: Because they are focused on one application, appchains attain high efficiencies that are almost impossible on general-purpose blockchains. This leads to improved user experience and faster transaction speeds and throughput.

6) Security: Appchains can be developed with security features that specifically suit the use case of the application, enhancing the overall security of the platform. That allows for the creation of an application that can handle the unique threats and vulnerabilities peculiar to its circumstance.

7) Sovereignty: Appchains can be independent and self-sustaining, reducing the risk of cascading failures from other systems. This allows the application to have a high success rate because everything happening in the ecosystem is easily controllable.

Disadvantages of Using Appchains

Despite the numerous benefits of using appchains, some limitations must be taken into consideration. The main downside is the complexity involved in building appchains, compared to traditional blockchains. In addition, appchains are expensive and time-consuming, with accompanying security and composability risks.

1) Resource intensive: The development of appchains is resource-intensive, requiring a considerable investment of expertise, financial cost, and team time. Launching an appchain requires a very long list of additional infrastructure which must be coordinated with validators. Unlike public blockchains that already have these infrastructures ready-made, appchain developers need a larger team and increased cost which may not be affordable for startups, especially in their early stages.

2) Security concerns: Appchain development involves building a lot of resources from scratch, including security features. The security of appchains largely depends on users' adoption of the application, validators’ effectiveness, and the price of its native token. If developers compromise on any security requirements to cut costs, the system will be susceptible to security vulnerabilities.

3) Smaller ecosystem: Because they are new and more tailor-made, the community following of appchains is very low compared to established blockchain platforms. This limits the available support and resources on the systems, and can also negatively affect the security of the platform.

4) Complexity: Although the specialized nature of appchains is a great feature, the platform becomes highly complex, making it challenging to develop and maintain the application over time.

5) Lack of composability: On public blockchains, applications have atomic composability, with each app seamlessly interacting with multiple protocols. This atomic composability is a unique feature of Web3 apps that enables them to solve diverse problems. However, appchains lack atomic composability because they are built in isolation from other blockchains. Achieving composability in appchains requires complex processes, like cross-chain bridging, which cannot be achieved atomically.

6) Bridging risks: Another limitation of appchains is the risk of bridging assets. Bridging risks is a peculiar problem for DeFi applications because their functionality depends on bridging several assets like ETH, stablecoins, and BTC. Bridging usually degrades the user experience and increases exposure to security threats. This risk is even higher with appchains because they may not attract reputable bridges, leaving them to settle for centralized bridges or custom-made ones.