Smart Contract Development - Here's What You Need to Know About It

Smart Contracts have been around for years and can be found in day-to-day lives such as when buying a subscription for an OTT platform, insuring a car, finding gigs, or renting an apartment. In other words, a contract is a legal agreement that binds two or more parties and is governed by the law. If any party bound by the agreement fails to comply with the terms and conditions, the law will not only determine the offenders but also oblige them to bear the penalties.

First developed during the period of Ancient Rome, contracts have evolved over time in complexity and size. Fast forward to today, contracts form the backbone of the modern business world.

Many business contracts are detailed, arduous, and lengthy documents replete with technical jargon that are hard to understand for a layman. In fact, business contracts require seasoned consultants or attorneys to frame them or decode them if needed. To overcome this challenge, new technology has emerged in recent years and is actively disrupting the realm of managing traditional contracts. Welcome to the world of Smart Contracts that are driven by Blockchain technology. Let’s dive deep into it.

What are Smart Contracts?

Smart Contracts are self-executing and self-enforcing contracts comprising a set of instructions that run when predetermined conditions are met. In other words, Smart Contracts are paperless digital codes that trigger an action or a series of actions when predefined conditions on which both the parties have agreed are fulfilled.

What makes Smart Contracts unique from traditional contracts is that they are autonomous, transparent, decentralized, and trustless in nature, which in turn, eliminates the need for third-party intermediaries as its code cannot be changed arbitrarily. With Smart Contract development, businesses can transact or exchange assets such as property, money, shares, gold, or anything of value in a fraction of the time. Furthermore, the self-executing nature of Smart Contracts makes them an integral component of decentralized applications (dApps).

Smart Contracts Use Cases in The Real World

1. Supply Chain

Businesses operating in the supply chain used to face a lot of hiccups owing to the traditional paper-based systems wherein forms have to pass through a multitude of channels for approvals. This laborious, tedious, and time-intensive process increases the risk of loss and fraud manifold. With Blockchain Smart Contract development services, businesses can nullify such risks by providing a secure and easily accessible digital version to all parties. Since Smart Contracts offer complete visibility and transparency, businesses can leverage them to track items across the supply chain. Besides this, Smart Contracts can also be used for automating tasks, payments, and inventory management.

2. Voting System

In every election, allegations of voting fraud surface on the internet. Despite using EVMs, miscreants find novel ways to manipulate the voting system. The best way to overcome this challenge is using Smart Contracts since it not only provides a secure environment but also validates a voter‘s identity, which in turn, makes the entire voting system less prone to manipulation. What’s more interesting about Smart Contracts is that it can increase the voters’ turnout, which has been consistently low owing to an inefficient and outdated system that enforces voters to line up, show their identity cards, and complete multiple forms to cast their votes. When the government voting system is digitized, it can positively increase the turnover of voters in elections.

3. Trading Activities

Another popular use case of Smart Contracts is in trading activities. With Smart Contract development, finance institutions can automate all the activities performed by a broker or a middleman. This, in turn, cuts down the additional costs associated with them. There are many enterprises out there that have started leveraging the potential of Smart Contracts for trading activities.

Benefits of Using Smart Contracts

1. Fast Performance

Unlike traditional business contracts, Smart Contracts can be executed way faster since it runs on software code and is always active on the internet. When there is no need to process contracts manually, businesses can save substantial hours on several processes.

2. High Accuracy

With Smart Contracts, you can cut down the chances of making errors. When coded correctly, Smart Contracts can be executed error-free. For instance, if you are filing taxes manually, there is a high possibility of making errors. On the other hand, you can make this process error-free using Smart Contracts.

3. Trustless

Smart Contracts run on a decentralized peer-to-peer (P2P) network, this simply means that there is no need to trust intermediaries or any third party to transact or exchange assets.

Summing Up

Smart Contracts are transforming the modern business world. Today, the use cases of Smart Contracts span across industry verticals including Loans and Mortgages, Insurance, Escrow, Product Development, Financial Data Recording, Medical Research, Clinical Trials, and more. Hire Blockchain Smart Contract Developers from a trusted company to improve your business efficiency.