The Smart Contract Gateway To The Future That You Must Know
Blockchain continues to show its potential beyond serving as the gateway for cryptocurrencies
This innovative technology is now geared towards revolutionizing several facets of life using decentralization methodologies across a wide spectrum of applications.
The exponential launch of new blockchain projects over the last 12 months is proof of this. At its core, many of these projects are utilizing the Ethereum platform’s smart contract technology, a powerful application of blockchain methodologies.
Smart contracts are just like any other regular contract in that they enforce an agreement between one or two parties. What makes Smart Contracts especially powerful, though, is that once the conditions of the deal are met, the contract automatically executes itself – without the need for a middleman.
Tamper proof and fraud proof, it promotes complete fairness, transparency and trust. It helps eliminate the security issues of having a third party facilitate the contract, which is not immune to a little fraud or deceit.
One of the best advantages of smart contract technology is complete transparency. It is a basic property of the blockchain, and one obviously inherited by smart contracts.
For smart contracts to be optimal, some provisions must be met. It needs all the details, terms and conditions clearly stated in exact detail; being a piece of code, it doesn’t understand nor will execute any vague provisions most contracts suffer from. And before it becomes active, all parties must agree to it 100%.
And because the smart contract is on a blockchain, everyone involved can see the details of the contract at any time. This eliminates any disputes due to miscommunication and prevents any manipulation or information shielding (the infamous “fine print”).
Not to mention that the contract will live on the blockchain forever – and this is useful if any future disputes arise and clarifications are needed.
This feature alone makes implementing smart contracts worth it for many applications. Imagine a public voting system utilizing this. A ballot is nothing more than a “contract” that states who someone chooses as their vote. All these are transparent and viewable by anyone, making manipulation next to impossible
Equitable Referral Compensation
In a clear equitable manner, smart contracts can also make referral compensation more efficient and fairer for everyone involved. Referrals are a very effective way of marketing for businesses, as people generally trust it more when someone they know recommends a product or service than if they see it at as an ad.
The inefficiencies with a referral system are that people are not generally properly compensated for the value they bring in. With manual reconciliation, errors will abound, people will and can pretty much game the system, and with the manpower and systems needed to properly track referrals, it becomes cost prohibitive for smaller businesses.
A smart contract powered referral compensation scheme can simplify all of these while ensuring fairness and proper crediting everyone with their due, automatically, without any manipulation or fear losing losing out.
And since this is all done in a self-executing way, fees are lower, bringing in savings to the businesses and/or bigger incentives to the customer, encouraging more referrals in a virtuous cycle.
The other salient point about smart contracts is cost efficiency. A lot of time and money is spent on just making sure an agreement or contract gets executed properly – the hordes of lawyers and witnesses needed on typical contracts is a testament to this.
By eliminating this, the price associated with executing a piece of contract is greatly reduced. Imagine the cost and time savings when you don’t need a lawyer to enforce inheritance wills, for example. No need to go through bureaucratic red tape or winding procedures.
Smart Contracts represent the most successful application of blockchain technology to date. It can be applied literally everywhere, from real estate transactions, voting systems, even smoothly executing earthly wills and testaments.
The advantages conferred by smart contracts are numerous, and their implementation is rather easy. The cost savings alone is worth going through the minimal effort to get these up and running.
Looking Into The Future
The future of our world will be driven by automated technologies and AI.Smart Contracts might be the gateway to that. Imagine the freedom, cost savings, security and efficiency these simple lines of code can do to our society. It’s an exciting time for blockchain, You can find out more how how smart contracts can impact your business.
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