Smart contracts are self-executing contracts with the terms of the agreement directly written into lines of code. They run on blockchain technology, which makes them transparent, secure, and tamper-proof.
Key Concepts
- Immutable: Once deployed, the code cannot be changed.
- Decentralized: The contract is not controlled by any single entity.
- Transparent: The code and its execution are visible to all participants.
- Automated: The contract automatically executes when predefined conditions are met.
Benefits
- Efficiency: Reduces the need for intermediaries and speeding up transactions.
- Security: The blockchain's inherent security features protect against fraud and manipulation.
- Cost Savings: Eliminates the need for lawyers and other intermediaries, reducing costs.
Use Cases
- Financial Services: Facilitating cross-border payments, insurance claims, and asset transfers.
- Real Estate: Streamlining property transactions and reducing fraud.
- Supply Chain: Ensuring transparency and traceability in the supply chain.
- Healthcare: Managing patient records and medical insurance claims.
Blockchain Diagram
For more information on blockchain technology and its applications, visit our Blockchain Basics page.