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What is a Smart Contract? And Why it is Important?

You probably know what blockchain is. If not, let’s recall: it is a decentralized system, whose existence is provided by a number of computers, united in one network. But what is a smart contract? Smart contracts allow you to exchange money and property without help of intermediaries.

For example, if you want to negotiate a normal deal, then you need the help of an appropriate specialist, whether a notary or a lawyer. In the case of smart contracts, you are dealing with a fully automated system: all you need is to drop it into the bitcoin register and the contract stored by a third party (for example, a driver’s license or any other document required by you) falls into your account. Another advantage of smart contracts is that the conditions that are specified in them are automatically provided by the system.

How can you use a smart contract in practice? In fact, the scope of applications of this technology is a lot. For example, they can completely eradicate falsification of elections, when the votes will be placed in a special register, the decryption of which will require a computer with incredible power. Also, its users will be able to find a smart contract in the field of logistics, helping to solve the problems of bureaucracy, so characteristic of this area. Smart contracts can also determine who was guilty of an accident, and insurance companies can find it easier to determine their contributions.

Smart contract and accounting, which will be used for real-time audit purposes, will not bypass the side. So far, smart contracts are only at an early stage of their development, but they can already be used in Ethereum and NEO.

2 Responses
  • SlimShady
    April 12, 2018

    The Next-Generation Cryptocurrency

  • SlimShady
    April 12, 2018

    The next -generation of crptocurrency to shape the world

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