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Bittime  - Smart contracts are essentially agreements encoded and stored on the blockchain, automating transactions between parties without intermediaries.

This automation ensures that the agreement is immutable and irrevocable, with the main goal of executing the agreement without the need for intermediaries, allowing all parties to verify the results directly.

Additionally, these contracts can be set to trigger actions based on certain conditions.

What Does It Mean for a Contract to Be Executed? 

In the realm of smart contracts, an executed contract indicates successful fulfillment of the agreement stipulated in the smart contract.

Once all conditions outlined in the smart contract code are met and the necessary actions are performed, the contract is considered executed.

Widely popularized by the Ethereum blockchain, smart contracts have paved the way for various decentralized applications (DApps) and other practical applications.

Striking Benefits of Blockchain Networks

It lies in their ability to automate tasks that would normally require a third-party intermediary.

For example, instead of relying on a bank to authorize the transfer of funds from a client to a freelancer, this process can happen automatically via smart contracts.

This more efficient approach reduces the time and costs associated with traditional contract execution.

Decentralized arbitration via smart contracts presents another scenario where disputes between parties can be resolved without relying on traditional legal frameworks or centralized arbitration bodies. 

Also Read: Get to know the Quasar Smart Contract by the OMG Foundation

Deploy Smart Contracts on Blockchain Networks

If disputes arise, smart contracts facilitate the collection of evidence and arguments from both parties. 

Once a decision is reached, the smart contract automatically executes the outcome, such as transferring funds to the incumbent or releasing the product or service to the appropriate entity.

Moving on to how smart contracts operate, they can be likened to digital “if-then” statements between multiple parties. If certain conditions are met, the agreement is honored, and the contract is fulfilled.

For example, let's consider a scenario where a market demands 100 bunches of corn from a farmer.

The market locks funds into smart contracts, which are then released when farmers provide the agreed amount. However, if the farmer fails to meet the deadline, the contract is cancelled, and the funds are returned to the market.

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Simple Case Example

Smart contracts can be customized to suit a variety of applications, potentially replacing traditional government regulations in retail transactions, among other functions.

Additionally, they have the potential to reduce the need to rely on the courts to resolve disputes, thereby saving time and resources for the parties involved.

The security of smart contracts essentially comes from their underlying code.

For example, on the Ethereum blockchain, contracts are scripted in Solidity , a programming language that is Turing-complete. This implies that smart contract rules and constraints are embedded in the network infrastructure, making it impossible for malicious actors to disrupt them.

In effect, such protection aims to reduce the risks associated with fraud or unauthorized changes to contracts.

Source: Cointelegraph

History of Smart Contracts

Far beyond the emergence of blockchain technology. Nick Szabo, a cryptographer, laid the foundations of smart contracts in the 1990s with his Bit Gold concept, although it was never implemented.

Szabo's idea foresees the potential for trustless transactions on the internet, a key aspect of smart contracts.

Also Read: Nick Szabo: Creator of Bit Gold and Mastermind of Smart Contracts

The real rise of smart contracts came with the emergence of blockchain in the late 2000s.

Blockchain provides the decentralized infrastructure needed to execute smart contracts without relying on a central authority. Ethereum is leading this concept, offering a platform for the placement and execution of smart contracts.

Smart Contract Analogy

Emphasizing their ability to automate transactions without human intervention.

Originally simple, smart contracts have evolved to handle complex tasks in a variety of domains, from supply chain management to real estate transactions and even voting systems. The flexibility of smart contracts promises to transform business processes and interpersonal interactions.

The benefits of smart contracts are numerous, including speed, efficiency, accuracy, trust, transparency, security, and cost savings.

By automating actions through computer protocols, smart contracts simplify business processes and minimize the risk of manipulation by intermediaries.

Also Read: What are the 11 Bitcoin ETFs that are approved by the SEC

Smart Challenge

Human errors in programming can lead to security breaches, as demonstrated by the infamous DAO attack on Ethereum in 2016.

The lack of clarity in regulations is also an obstacle, especially regarding taxes and government supervision.

Additionally, the inability of smart contracts to access external data sources without oracles limits their applicability in some real-world scenarios.

Despite These Challenges

Smart contracts find various applications in various industries. From digital identity management to real estate transactions, insurance policies, and supply chain logistics, smart contracts offer a trustless and efficient alternative to traditional processes.

The integration of smart contract capabilities into Bitcoin, facilitated by improvements such as Taproot, further expands its potential impact.

Additionally, the development of user-friendly smart contract platforms allows non-programmers to create and deploy smart contracts easily.

These platforms offer intuitive interfaces and templates, democratizing access to smart contract technology and driving innovation.

Also Read: What is a Smart Token and How it Works

Looking ahead

Smart contracts are poised to revolutionize business operations and daily interactions, reducing reliance on manual processes and bureaucracy. While challenges remain, the widespread adoption of smart contracts across sectors signals a transformational shift towards automated and decentralized governance.

How to Buy Crypto on Bittime

You can buy and sell crypto assets in an easy and safe way via Bittime . Bittime is one of the best crypto applications in Indonesia which is officially registered with Bappebti. 

To be able to buy crypto assets on Bittime , make sure you have registered and completed identity verification. Apart from that, also make sure that you have sufficient balance by depositing some funds into your wallet. For your information, the minimum purchase of assets on Bittime is IDR 10,000. After that, you can purchase crypto assets in the application. 

Monitor price chart movements of Bitcoin (BTC) , Ethereum (ETH) , Solana (SOL) and other cryptos to find out today's crypto market trends in real-time on Bittime.

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DISCLAIMER: This article is informational in nature and is not an offer or invitation to sell or buy any crypto assets. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices can change significantly from time to time and Bittime is not responsible for changes in fluctuations in crypto asset exchange rates.