Blockchain-based smart contracts and smart working

Smart contracts are programs that run when specific criteria are satisfied and are maintained on a blockchain.

Generally, they're used for automating the execution of an agreement so that all parties can be sure of the conclusion right away, without the need for any intermediaries or time waste. Additionally, they can automate a workflow while triggering the following step when certain circumstances are satisfied.

Smart contracts and smart work

Simple statements like "if, when, why, then..." are converted into code language on a blockchain to make smart contracts work.

When pre-set circumstances are validated and satisfied, the activities are carried out by a network of computers. These activities could include issuing a ticket, vehicle registration, transferring payments to the right parties or sending alerts.

Upon completion of the transaction, the blockchain gets updated. That means the transaction can't be modified or altered, and only those who have access to this can view the results.

There can be as many specifications as needed in a smart contract in order to convince the participants that the task will be correctly executed and that too, with satisfactory results. Participants need to agree upon how transactions and associated data are represented on the blockchain.

They have to agree on the “if, when, why, then...” rules that administer those transactions, design a framework for resolving clashes and investigate all conceivable exceptions in order to set the terms and conditions. The smart contract can then be coded by a developer.

However, firms that use blockchain for their business are increasingly providing web interfaces, templates and other online tools to make the process of smart contract structuring seamless.

Fast & efficient – benefits of smart contracts

Explore how smart contracts in active blockchain solutions benefit enterprises:

Security

Since blockchain transaction records are encrypted, they are extremely difficult to hack. Furthermore, every record on a distributed ledger is linked to the preceding and subsequent entries. Therefore, hackers would have to change the entire chain to alter a single record.

Transparency

There's no need to worry about data or information being tampered with for personal gain since the third party has no involvement or engagement, and encrypted transaction logs are exchanged among participants.

Accuracy

When a condition is met, the contract is immediately executed. Since smart contracts are automated, there is no paperwork to deal with and no need for correction of errors that can occur when filling out documentation manually.

Savings

Smart contracts eliminate the need for intermediaries to conduct transactions, as well as the time delays and expenses that are associated with them.

Application of smart contracts by top-ranked companies

Strengthening the bond between retailer and supplier

Companies like "The Home Depot" employs blockchain-based smart contracts to resolve vendor issues efficiently. They are strengthening connections with suppliers through real-time communication and better insight into the supply chain, resulting in more time for other important work and innovation.

Protecting the efficacy of life-saving medications

By boosting supply chain transparency, leading companies like Sonoco and IBM are trying to limit the challenges and difficulties in the shipment of life-saving drugs.

A blockchain-based platform, Pharma Portal, tracks temperature-controlled pharmaceuticals along the supply chain to offer accurate, reliable and trusted data to numerous stakeholders. It is powered by IBM Blockchain Transparent Supply.

Making international trade more efficient

Businesses that join "we.trade", IBM Blockchain's trade finance network, help build a trusted environment for global commerce.

We.trade, a blockchain-based platform, provides uniform rules and streamlined trading choices to decrease friction and challenges while simplifying the trading process and boosting trade prospects for participating businesses and banks.

Final thoughts

Summing up, blockchain-based smart contracts are used in various industries to perform different functions.

Contractual enforceability, regulatory compliance, cross-border financial transactions, home buying, property ownership, material provenance, supply management, document management and a variety of other applications are just a few of the possibilities.

Smart contracts are now used in fields such as the legal transfer of ownership of digital financial assets, logistical procedures, banking and credit services, decentralized storage, the usage of renewable energy and product tracking services.

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