Knowledge about Smart contract

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Smart Contract

 Smart contract was introduced a decade ago. Hick Szabo did not introduce the idea of a smart contract to him until later, in 1994. In 2013, Vitalik Butrin, the founder of Ethereum, integrated smart contracts with blockchain technology.

 Explanation of smart contract and working  of  a smart contract  

  • Smart Contact is executed (executed) from the Blockchain Network, and the code of the contract is repeated on many computers. It provides a more transparent and safe facility, rules, and conditions. There is no need for a third party in a smart contract i.e. does not affect a middleman
  • Smart Contract has an agreement on two logos that work as Computer Code. Smart contract works on Blockchain Technology, which is stored in a Public Database and can not be changed.
  • A smart contract is similar to a normal contract, a normal contract is in the form of paper form whereas a smart contract is in the form of a computer program.
  • A Smart Contract is a computer program or an exchange protocol that is intended to naturally execute, control, or document lawfully relevant events and activities as indicated by the provisions of a contract or an agreement.
  • The targets of smart contracts are the decrease of need in believed intermediate, arbitrations and requirement costs, fraud losses as well as the decrease of malicious and accidental exceptions.
  • A smart contract is a Computer program, it is a normal smart contract, smart contracts depend on computer code that keeps explicit guidelines and rules. Smart contracts are based on the blockchain concept

       Types of a smart contract –

  1. Decentralized Autonomous Organizations (DAOS)
  2. Smart legal  contract
  3. Application logic contracts (ALCs)

Benefits of Smart contract-

1. Smart contracts are stored in blockchain technology, due to which it is impossible to hack or change. The same common contract can also be stolen or lost or can be torn and the biggest thing is that they can be changed very easily. It takes a lot of time to create simple contracts, whereas in smart contracts the whole lot happens quicker with the help of laptop programming.

2. Smart contracts remove the third party from the middle, which saves you a lot of time and money. Once the terms and conditions are, agreements have to be made by coding on the smart contract, after that it does all the work itself, and no one is needed.

Disadvantages of smart contract

1. The biggest disadvantage of smart contracts is that if the contract is not created properly and any loophole is left in it, then it can easily hack the smart contract and steal all the data and money. The smart contract is designed in such a manner that once it is generated, it cannot be turned back, therefore if an error occurs when it is being created, it cannot be fixed.

2. If anything goes wrong while transacting in the smart contract, then no one will be able to help you because it is not under the control of the government or any third party, so all the responsibility will be yours. There are no proper rules and regulations regarding smart contracts, so many people are afraid to use them. 

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