{"id":5726,"date":"2023-01-30T13:01:17","date_gmt":"2023-01-30T13:01:17","guid":{"rendered":"https:\/\/www.bsetec.com\/blog\/?p=5726"},"modified":"2023-04-26T10:32:51","modified_gmt":"2023-04-26T10:32:51","slug":"what-are-smart-contracts-on-the-blockchain","status":"publish","type":"post","link":"https:\/\/www.bsetec.com\/blog\/what-are-smart-contracts-on-the-blockchain\/","title":{"rendered":"What Are Smart Contracts on the Blockchain?"},"content":{"rendered":"

\"What<\/p>\n

We have talked about digital cash in the early days and here we are slowly the digital assets like bitcoins, ether and other cryptocurrencies are slowly becoming mainstream digital cash! Similarly, <\/span>smart contracts<\/b><\/a> are the digital versions of traditional contracts! They are the backbone of Ethereum and other reputed blockchains.<\/span><\/p>\n

Origin of Smart Contracts<\/b><\/p>\n

The phrase “smart contract” was first used by Nick Szabo. He published the idea in 1994 and an examination of the potential applications of smart contracts in 1996. Nick Szabo’s concept was a digital marketplace based on these automated, cryptographically secure procedures. A setting where business operations and transactions can be conducted directly and without middlemen. In recent times. Ethereum’s smart contracts make this vision a reality.<\/span><\/p>\n

What are Smart Contracts?<\/b><\/h2>\n

Smart contracts digitalize contracts, By converting an agreement’s terms into computer code that runs automatically when the conditions of the contract are met. Smart Contract (or Crypto Contract) is a computer program. The conditions of the agreement between the buyer and seller are directly written into lines of code, making it a self-executing contract. The agreements and underlying code exist in the decentralized blockchain network. The major advantage of smart contracts is that the transactions are traceable and irreversible, and the code regulates their execution.\u00a0 Smart contracts enable trusted transactions and agreements to be made between distant, anonymous parties.<\/span><\/p>\n

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Read\u00a07 Advantages of Using Smart Contracts!<\/a><\/h4>\n<\/blockquote>\n

Automatic Execution<\/b><\/p>\n

A smart contract is programmed to do things if this – then that style. For example, vending machine analogy can be beneficial to understand the concept better.\u00a0<\/span><\/p>\n

Analogy – Digital Vending Machine<\/b><\/p>\n

The vending machine delivers the mentioned coke or coffee of your choice when you put a dollar in it; for example, when you choose the item, the vending machine displays the cost of the item, and when you pay the amount, it fills your cup with coke or coffee of your choice. It is programmed that way. Similarly, the smart contract is programmed with certain predetermined conditions depending on the agreement.<\/span><\/p>\n

Features of Smart Contracts<\/b><\/p>\n