Smart Contracts: How human trust are being changed.

Smart Contracts: How human trust are being changed.

How  smart contracts are changing the way we trust people

smart contract, also referred as a crypto contract , is a computer program which directly controls the transfer of digital currencies or assets between parties involved under certain conditions and these terms of agreement between the contracting parties are written directly into the code, a blockchain technology with decentralized ledger that also controls bitcoin and other cryptocurrencies. Once the terms and conditions of the contract are met , it executes automatically.

Its also a reformative new technology and it a component of Ethereum, blockchain protocol and the protocol which pioneered the technology.

The structure of smart contract are brought fundamental changes in the nature of trust in contracts, operate on peer to peer transactions between the parties involved, no intermediaries to keep not of what has happened or what is happening.

In this case everything is laid open , the history of the former executed transactions and the ongoing ones are on public ledger visible to anyone at anytime. The records are immutable, very transparent, this makes them free from any form of fraud, manipulation, corruption even any form of mistake and much secured too.

This is one Blockchain’s biggest advantages of been able to close transactions without third party and still maintains trust, without comprising transactional verification and validation and still reduces cost and time. This in most cases may be achieved with intermediaries.

We are now in a new age of digital securities which facilitate peer-to-peer transfers of assets such as real estate and other monetary transaction through the use of smart contracts. In this case the parties dont have to worry about the other person not being able to meet up with its responsibilities or someone taking advantage of the other.

When it comes to trust, smart contracts create a type of transaction that does not even need to consider the concept. Cryptocurrency transactions are considered on the basis of no issue or any concept called trust, in smart contracts does not even consider the concept trust in its operation because trust doesn’t even enter into the equation.

Smart contracts comes to play in so many business transaction of blockchain. You can use smart contract to send money over the internet without any knowledge of the person, directly without a third party. Either of
the parties involved can not cheat because the conditions of the contract are recorded in a public ledger that is immutable.. Once the agreement us met the contract will execute automatically. It is essential to help in minimizing trust need in business.

From the foregoing, it then falls the two parties or the parties to any transaction to come to terms with an agreement and then let the smart contract execute or and not dependent upon whether the parties involved would fulfil the obligations, making it very easy to trust others, as their transaction is now safe in the , competent hand of the automatic management of a blockchain-based smart contract.

These smart contracts can be operated in Land use cases, Education, IT, tokenization of real estate, businesses and other assets.

 

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Credit: Wikipedia, Bitcoinke

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