“Ethereum is enabling a new form of financing in ICOs that is like a massive gravitational pull – dragging every entrepreneur with a sense for opportunity into its blackhole-level gravity.” -Gil Penchina
I got asked to further define smart contracts, so we are gonna start there. What is a smart contract? A smart contract is a decentralized computer protocol which functions as an automatic contract system. Participants in these “smart contracts” agree to a predetermined set of rules where transactions then happen in the confines of these rules. Transactions are then stored on the blockchain network where they stay permanently. Smart Contracts are nearly impossible to alter or breach, so participants can enjoy true voluntary exchange, and mutual benefit without needing to trust the other party.
Now that we have defined a Smart Contract more in depth, we have to find out what some application looks like. Smart Contracts can be applied in a range of existing industries; from stocking the shelves, voting and record keeping to completing trades in equity markets, and property ownership and beyond. The Mortgage process for example will take a fraction of the time to complete, and transfer of ownership will never be easier. This efficiency is because a Smart Contract can verify parameters of the mortgage agreement instantly, and the buyer and seller simply have to agree to the terms for the contract to execute. Ownership fraud claims will drop, and information transactions will be more secure because the blockchain is tamper proof. Record keeping will be totally automated using this technology, because now companies and governments can streamline their record keeping with a super secure block chain network saving companies money on network security, internet access and storage space. Records will be more secure, and less prone to inaccuracies. Specifically when we look at medical records for example you can use smart contracts to automate prescription filling, and general medical information for patients, and healthcare professionals alike.
We are just getting started with what these Smart Contracts are capable of completing, and their future function is practically unlimited at this point in time. We hope you are as excited as us to see what the future holds for such an innovation. This Contract technology will disrupt a lot of existing processes and industries. Smart contracts will cause major shifts in how business is conducted today; however this disruption will allow prices to become more competitive due to innovation in the market space. Shifts of this nature will ultimately benefit the society as a whole, and open new career fields along the way. We will dive more into this subject more tomorrow on the podcast so please stay tuned for more!
