Prominent role of smart contracts with blockchain

Smart contracts

When we say “Smart contracts”, they are basically the lines of code stored on a blockchain executed automatically when predetermined terms and conditions are met. These contracts contribute a lot when it comes to business collaborations where any type of agreement is enforced to make sure that all the users or participants are certain of the results with no involvement of any intermediary.

Blockchain

Blockchain is referred to as the shared, distributed ledger where transactions are digitally recorded and linked together to render all the details or provenance of an asset. Not only this, transactionsare added to the blockchain once it’s validated by the consensus protocol which verifies the same to be the true version. During the process, each record is encrypted to allow for a greater level of security.

Blockchain provides highly immutable platform because the records stored over there cannot be altered. All the participants of smart contract developed by the business have access to the same version.

Significance of smart contracts with blockchain

  • Smart contracts eliminates the need for employing intermediaries to perform the job as participants can easily rely upon visible data and technology to execute the transaction with great efficiency.

 

  • It brings speed and accuracy to the transactions as smart contracts are digitized and automated. Users don’t need to waste their precious time in processing paperwork or reconciling and correcting errors unlike documents. As we all know, computer codes are more exact than the legalese that traditional contracts are written with.

 

  • The concerned platform brings trust factor to the transactions as smart contracts automatically execute them depending on predetermined rules and encrypted records of those transactions are shared across the entire network.

 

  • Blockchain transaction records are encrypted which makes it nearly impossible to hack any kind of details or information. Overall, it ensures security of transactions.

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