Smart Contract: Have you already been a Part of it?
So called Smart Contracts are important for digital processes and for a lot of industries. They can be defined as self-executing contracts between two parties. The Smart Contract can be written directly into the code of a blockchain network for example.
In 1994 the first Smart Contracts were announced by Nick Szabo. They are a few years older than Bitcoin and most crypto currencies. Smart Contracts are completely digital. That means that no paper is needed. Within a smart contract, there is an “if”…”then” scenario described. The whole contract is stored in a block of a blockchain and it runs automatically. If a process meets a condition, the code will perform the defined action.
Smart Contracts from a researchers perspective
At Cornell Private Research University in New York Maher Alharby and Aad van Moorsel published a paper about Smart Contracts. They conducted “a systematic mapping study to collect all research that is relevant to smart contracts from a technical perspective”. It was their aim to identify current and future research topics about smart contract research. Altogether Alharby and van Moorsel analyzed 24 papers from scientific databases. Most sources focused on how to identify and tack smart contract topics. They were connected with key topics like security, privacy or performance.
Camelot Management Consultants interviewed Sales Managers about Blockchain and Smart Contracts. To sum it up, for many Sales Managers Smart Contracts do belong to our digital world of shopping in the future. While using Smart Contracts, companies do use the whole potential of the blockchain technique.
How are Smart Contracts used in our daily life?
In our daily life there are several scenarios, in which Smart Contracts play a major role. In the field of Supply Chain and Logistics for example Smart Contracts are really important. In a supermarket for example it can be possible to order new products, if a defined amount of bottles has been sold. It is also possible to transfer information by using Smart Contracts. This makes a tracking process for products possible. If someone sends a parcel to another person, smart devices can track the parcel via an ID. The devices save the information whenever the parcel is scanned into the blockchain and finally the receiver can track where the parcel is and where the parcel has been.
For traders, Smart Contracts are also important. It is possible to sell or buy shares by using Smart Contracts. If the price for a share decreases to a defined value, a Smart Contract can initiate buying or selling the shares. The technology of Smart Contracts can be used to improve investment strategies and to mitigate trading risks.
Most people don´t know about Smart Contracts, but they are aware of so called “if…then” dependencies. In the future Smart Contracts will be used to several use cases and they will become more and more important in case of automation.
The Future of Smart Contracts
Within the next years, Smart Contracts will play a much more important role than today. It is possible to use them for a lot of scenarios. One of the most advantageous elements of Smart Contracts is the fact that they are safe and that it is nearly impossible to manipulate them. In the world of finance, they can be used in the field of credits or for example to analyze shares and whole processes. Also in the industry of automotive it is possible to use Smart Contracts by developing new technologies. To make driving safe it can be possible to measure alcohol in human’s breath. If a detector measures to much alcohol, the car won´t start. This process can be stored as a Smart Contract for example. All of those Smart Contracts run automatically. That means that human failure won´t play a role and of course by using Smart Contracts a lot of time can be saved.