Smart Contracts? — What You Should Know.
Ethereum Platform, ever since its inception in the mid-2015, has given rise to a new breed of developers known as — Blockchain Developers. The myriad of decentralized applications on the ethereum platform, each claiming to address some or the other challenges in the current business processes have earned eyeballs of technology giants and central governing bodies who have turned investors and innovators in order to capitalize the trend.
The invention of smart contracts dates back to 1996. Computer scientist, Nick Szabo drew up the term “smart contracts,” and explaining:
“I call these new contracts “smart”, because they are far more functional than their inanimate paper-based ancestors. No use of artificial intelligence is implied. A smart contract is a set of promises, specified in digital form, including protocols within which the parties perform on these promises” — Nick Szabo
The lack of supply compared to the tremendous demand for developers and experts in the blockchain domain has led to the establishment of Blockchain Courses by several top institutes of the nation. Indian Institute of Management, Lucknow has partnered with Blockchain Lab, India to conduct Advance Blockchain Certification Course for executives and entrepreneurs. The course aims to equip business leaders and innovators with the necessary skill set, required to implement Blockchain in business operations. The course will help participants build and deploy decentralized applications with real time examples. You can get more details on the course, here.
So what are smart contracts? A smart contract is a computer code running over a blockchain network, containing a set of pre-defined rules which when met, automatically enforces the transaction between the concerned parties.
The aim of smart contracts is to provide security that is superior to traditional contract law and to reduce other transaction costs associated with contracting.
Smart Contracts have unique in its characteristic than traditional contracts as they are: Self-verifiable — the pre-defined rules once put does not need third party interference to manage the contract.
Self-executable — Once the rules are met, smart contracts automatically execute the transaction in real time without any delays or manipulation.
Tamper-Proof — Smart Contracts once executed, can not be tampered or manipulated, unless and until the broad consensus is met on the forking request.
The advantages of deploying smart contracts in today’s world are:
* Transparency Smart contracts over blockchain network, imbibes the transparency characteristic of the blockchain enabling participants to fully understand the contract codes without any hidden clauses. This leads to trust-free ecosystem eliminating disputes arising out of unclear contract codes.
* Time Efficient Smart Contracts execute in real time eliminating the time lag in claiming processes as observed in traditional systems. Smart contracts by its virtue, enable swift compliance to contracts allowing large scale implementation.
* Cost Efficient An agreement or contract between parties or group of parties today, involves tedious paperwork and third party mediators in order to facilitate the trust-embedded-contract in motion. The costs involved in these processes can be eliminated by implementing smart contracts.
* Security The smart contracts created are immutable in character which makes them highly secure compared to any other contracting medium.
The potential of smart contracts cannot be limited. Their potential use case varies from — small regular agreements to large government or enterprise contracts, single geographical location to worldwide coverage. Smart Contracting is the future to a trust free world of doing business.
