Do you know what is a Smart Contract?
“Secure, transparent, no third-party, autonomous & accurate”
What is a smart contract?
Smart contracts are digital contracts or agreements between parties in the form of computer code. This allow two or more parties to undertake some form of exchange. This could be anything from a money transfer to property transfers such homes, supply chain goods, etc.
How do smart contracts work?
Smart contracts operate on a blockchain, are stored in this public “database” and cannot be changed. They allow parties to agree specific terms or enter into a specific agreement, which once completed, triggers the smart contracts to initiate an action such as transferring money etc.
Usually, Smart Contracts are developed using Ethereum’s original coding language, Solidity.
What are the benefits of smart contracts?
- Autonomy — Decentralized nature of the blockchain contracts underlying these smart contracts as well as the nature of the contract themselves means no outside party is required in the process.
- More secure — Blockchain technology creates unalterable ledgers that provide definitive proof of transactions. It also relies on encryption while operating as a secure peer to peer transaction system.
- Faster speeds — Without the need for a middleman, speeds are much faster.
- Increased accuracy — Humans make mistakes, smart contracts are designed not to.
- Cost savings — The automated process lowers costs significantly.
- Trust — Unalterable ledgers mean transactions are set in stone.
- Backup — Data storage devices can fail. Smart contracts duplicate all transactions so that all parties have a record of the transitions. The likelihood that all parties are going to suffer data storage failures is practically nonexistent.
What are the business use cases for smart contract?
- Automation of business processes
- Property and money transfer
- Accounting
- Supply chain automation
Some examples are trade finance, records, property ownership, mortgages, insurance, voting, peer-to-peer transactions, product development etc
references: https://www.devteam.space/blog/10-uses-for-smart-contracts/