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Smart Contracts

Smart Contracts are digital contracts stored on a blockchain that are automatically executed when predetermined terms and conditions are met. A self-executing program, a smart contract automates agreements between the creator and recipient, making them immutable and irreversible. Smart contracts permit trusted transactions and agreements to be carried out among disparate, anonymous parties without the need for a central authority, legal system, or external enforcement mechanism. They allow developers to build apps that take advantage of blockchain security, reliability, and accessibility while offering sophisticated peer-to-peer functionality — everything from loans and insurance to logistics and gaming. Popularized by the Ethereum blockchain, smart contracts have led to the network’s array of decentralized applications and other use cases.

BENEFITS OF SMART CONTRACTS

  • Speed, efficiency and accuracy. Once a condition is met, the contract is executed immediately. Since they are automated, there's no paperwork to process.

  • Trust and transparency. No third party involved. Encrypted records of transactions are shared across participants. No need to question changes made for personal benefit.

  • Security. Blockchain transaction records are encrypted, which makes them very hard to hack. Hackers would have to alter the entire chain to change a single record.

  • Savings. Smart contracts remove the need for intermediaries to handle transactions and, by extension, their associated time delays and fees.


Here are some examples of how smart contracts are being used today: 


  • Financial Transactions. Automate financial transactions, such as payments and loans. This can help to reduce costs and improve efficiency.

  • Real Estate Transactions. Automate real estate transactions, such as buying and selling property. This can help to make the process more transparent and efficient.

  • Supply Chain Management. Track and manage products as they move through the supply chain. This can help to improve transparency and efficiency.

  • Voting. Used to develop electronic voting systems that are more secure and transparent than traditional voting systems.

  • Insurance. Used to create a decentralized insurance system, where people could pool their money to insure each other against risks.

  • Gaming. Develop new types of games and gaming platforms. Used to create games where players can own and trade in-game assets.

Warnings and Disclaimers

The information contained herein is obtained from sources believed to be reliable, but its accuracy cannot be guaranteed. It is not designed to meet your personal financial situation - we are not investment advisors nor do we give personalized investment advice. The opinions expressed herein are those of the publisher and are subject to change without notice. It may become outdated an there is no obligation to update any such information.

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