blockchain smart contracts

Blockchain Smart Contracts 

Smart contracts are computer programs that are hosted and executed on a blockchain. Each smart contract consists of code specifying predetermined conditions that, when met, trigger outcomes. By running on a decentralized blockchain instead of a centralized server, smart contracts allow multiple parties to come to a shared result in an accurate, timely, and tamper-proof manner.

Smart contracts are a powerful infrastructure for automation because they are not controlled by a central administrator and are not vulnerable to single points of attack by malicious entities. When applied to multi-party digital agreements, smart contract applications can reduce counterparty risk, increase efficiency, lower costs, and provide new levels of transparency into processes.

The operation of a smart contract is similar to other blockchain transfers. These are the necessary steps 

1.A user initiates a transaction from their blockchain wallet.

2. The transaction arrives at the distributed database, where the identity is confirmed.

3. The transaction, which may be a transfer of funds, is approved.

4. The transaction includes the code that defines what type of transaction is to be executed.

5. The transactions are added as a block within the blockchain.

6. Any change in contract status follows the same process to be updated.

smart contracts on blockchain :

• Ethereum: smart contracts are written in a programming language called Solidity and executed by the Ethereum virtual machine. It is currently the most popular.
• Hyperledger: an open source system developed by the Linux Foundation that is not a cryptocurrency, but a flexible platform on which smart contracts can be developed.
• Counterparty: this platform incorporates data into Bitcoin transactions, i.e. it uses the cryptocurrency's blockchain and allows contracts to be developed on it.
• Polkadot: it is an alternative to blockchain and is famous for its ability to host parachains, chains within chains, allowing more transactions than usual.

Smart Contract Application : 

1. Records : Smart contracts will facilitate the storage and maintenance of records. For example, the millions of confidential patient records that need to be securely stored and updated.

2. Trade : Most commercial activities depend on the approval of their funding, which is a time-consuming and resource-intensive process. Thanks to smart contracts, this time can be dramatically reduced.

4. NFTS and Gaming : The global gaming industry, valued at $100 billion and growing rapidly, sometimes experiences unfair distribution of value. Typically, game designers create and release games, and players pay money to access and interact with them. This results in a unidirectional flow of value, requiring players to spend real money to acquire in-game assets and additional gameplay options. However, the incorporation of blockchain technology in games can enhance the value players derive from their in-game investments.

4. Supply chains : Internet of things devices can be used throughout the supply chain to record every step of a product and improve its traceability. In this way, errors, theft and loss can be eliminated.

 5. Mortgages : Mortgage transactions based on smart contracts will be cheaper, faster and safer. This will allow buyers to access the property earlier and update the records automatically.

 6.Property market : Smart contracts can be used to register property ownership more efficiently. Moreover, their use can extend beyond flats, buildings or land and register all types of assets.

7. Human Resources : The use of smart contracts that record a person's academic qualifications, certificates and experience can prevent fraud in CVs and therefore facilitate the recruitment of individuals, also companies, providing a service. 

8. Intellectual property : Many companies are dragged into years of court disputes over the use of patents in project development. Smart contracts can keep track of which part belongs to which company.

9. Health : In addition to the recording of health data mentioned above, its application in this sector can range from the traceability of medicines to the management of the cold chain, the health passport or clinical research.

10 . Elections : Electoral fraud is a real risk in some countries and has been used as a political weapon to destabilise others. Smart contracts make it possible to validate a voter's identity and reliably record their vote. 

11. Insurance : The industry spends millions each year on claims processing and claims handling. Smart contracts will allow payment amounts to be determined automatically based on the type of policy.

12. Government : Smart contracts offer significant advantages in automating procedures, making them highly valuable for government activities. One area where they can be particularly beneficial is in facilitating transparent and orderly property transfers during the land ownership registration process. By employing smart contracts, transparency can be enhanced throughout the system, while the cost of audits can be reduced.

Furthermore, smart contracts have various applications in government operations, including electronic record filing, electronic elections, and digital identities, as previously discussed.

BENEFITS OF A SMART CONTRACT 

• Independence: the participants make the arrangements themselves, i.e. the involvement of intermediaries can be dispensed with.
• Reliability: the contract is securely stored in a distributed network and is virtually impossible to alter or forge.
• Security: being in a distributed network, the contract is duplicated in all nodes of the network and cannot be lost.
• Savings: by cutting out intermediaries and commissions, there is a reduction in costs for all parties involved.
• Accuracy: this type of contract reduces to zero the possibility of errors in the terms or processing.
• Sustainability: contracts eliminate the use of paper in offices, notaries and registers, and pollution is reduced as a result of less trade.

Companies that implement smart Contracts Blockchain 

• IBM and Sonoco – The companies use the Smart Contracts Blockchain to track pharmaceuticals throughout the supply chain process. 
• Home Depot – The company uses Smart Contracts to quickly resolve any disputes with the vendor.
• we.trade – The company uses Smart Contracts to make the trading process simpler and by expanding opportunities for more banks and companies to trade

Future of smart Contracts Blockchain 

There is a need for more development in Smart Contracts if they are to be used for complex commercial transactions. But at the same time, Smart Contracts can potentially revolutionize how the incentive and reward structure works in contracts. Smart Contracts help us take traditional onto the digital platform, but there could be a lot more achieved in the future from different paradigms.

Conclusion 

Blockchain technology enables the development of smart contracts, which is a highly attractive aspect of this technology. It can be compared to computer programs that employ “if-then” logic, commonly referred to as conditional programming. By leveraging blockchain as a database, transactions are verified, and predetermined conditions are executed through smart contracts. This utilization of smart contracts has the potential to bring about positive changes in various areas by eliminating the requirement for commissions. Moreover, it can potentially reduce instances of fraud, delays, and overall costs.