The advent of Blockchain technology opens up possibilities that have not previously been available. The technology behind certain Blockchains even allows for processes and deals affecting real life events and agreements to become automated. Essentially, smart contracts are like regular contracts, but they are self-executing and are derived from lines of code. The most commonly used programming language for smart contract development is Solidity.
Smart contracts allow for trusted agreements and transactions to be executed by individuals that do not necessarily know each other, yet whose interests are protected by the immutability of a smart contract, and without the need to rely on a third party such as a bank, legal authority, or any other central governing system. This article will cover everything you need to know about Blockchain smart contracts. Let’s start with how they are better than normal contracts.
Why Smart Contracts are Better than Normal Contracts
Normal contracts usually involve a few parties, messing around with lawyers, going through negotiations, several drafts, and finalizing agreements. Regular contracts require human intervention and administration and are usually stored in either paper or digital form. Additionally, there is always a chance that a party taking part in a normal contract might misbehave and act unethically. Yet, the greatest disadvantage of regular contracts is that they can be counterfeited or even destroyed.
In contrast, smart contracts allow individuals to bypass all of the paper shuffling, negotiations, and potential mediation. They are also entirely self-executing, and will execute depending on pre-imposed conditions being met. Each action taken through a smart contract is forever added to a decentralized ledger, thus, nothing can be changed pertaining to the initial agreement after the fact of execution. Smart contracts have seen extensive use in bonus and security systems, where they store extremely important information. Another area of their utilization is crowdfunding, especially within the bounds of Initial Coin Offerings, or ICOs, due to the fact that they provide individuals with the ability to streamline and automate crowdfunding processes. But, how are they made?
In the full article on MLSDev blog learn about the following:
- Blockchains that are utilized for smart contract development
- Smart contract audits and their importance
