As the name suggests it’s a contract and what do you understand by a contract ? A contract is a set of rules that lays out the terms of an agreement, agreement between two parties. It is smart because it automatically executes the encoded rules when it’s called by a user on the blockchain. A smart contract is a digital self executing contract ( it’s just a set of code)
But again what makes it so special that people around the globe trust it ?
- Once deployed, it can’t be modified and will always function identically.
- Instead of needing a third party or an individual to control it, it itself serves as a reliable third party and guaranteed impartiality. It is decentralized in nature.
- Smart contracts are published to the blockchain, and can be read and written by anyone who has access to the blockchain. They are transparent in nature.
The next important question is how to write a web3 contract(smart contract I mean). Think about all the things we need before writing a real world deal.
- Parties involved in the deal : Identify the parties involved in the transaction.
- Type of asset exchange : Clearly outline the type of assets ( could be tokens, NFTs, other cryptocurrencies)
- Conditions of the deal : Define the rules under which the transaction will take place.
When writing a smart contract, developer needs to choose a programming language suitable for the blockchain platform they are deploying the contract on. For example Ethereum uses Solidity, Hyperledger Fabric uses Go, Javascript , Chaincode uses Go and Corda uses Kotlin etc
Read more about —
Real World Use Cases for smart contracts
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