What Are Smart Contracts?
Smart contracts are self-executing contracts with the terms directly written into code. They automatically execute when predefined conditions are met.
Key Features
- Automation: Execute without intermediaries
- Transparency: Code is visible on blockchain
- Immutability: Cannot be altered once deployed
- Trustless: No need to trust counterparties
How Smart Contracts Work
- Parties agree to terms
- Terms are coded into the contract
- Contract is deployed to blockchain
- Conditions are monitored
- Automatic execution when conditions are met
Applications
Decentralized Finance (DeFi)
- Lending and borrowing
- Decentralized exchanges
- Yield farming protocols
NFTs
Digital art and collectibles ownership
Supply Chain
Automated payments upon delivery confirmation
Insurance
Automatic claims processing
Platforms Supporting Smart Contracts
- Ethereum
- Solana
- Cardano
- Avalanche
- Polygon
Conclusion
Smart contracts are revolutionizing how we think about agreements and automation in the digital age.
