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The digital world is growing exceptionally well, making long processes convenient for people by making everything automated. Wouldn’t you like to get your money transferred within a few minutes instead of 3 business days? Cryptocurrency like Bitcoin is taking the profits ways as automation, and safe transactions are compelling people to invest in it despite its turbulent nature. People now pay for what gives them the most convenience instead of finding the cheap way around things.

 

Blockchain run software programs, Smart contracts are the same as standard contracts but are automated. This is the primary difference between the two, which makes smart contracts more acceptable. They are coded into the system like a computer program instead of writing on paper. This way, the user won’t have to carry a paper around whenever they need to access the contract. They can just remember their contracts’ codes and access them through any device. They are also much safer and cheaper than traditional contracts. 

 

Let’s learn more about their properties and how they will change the course of banking and finance.

Self-Execution Through Automation

Starting from the primary advantage of the contracts, they are widely accepted by many as they can be coded before the date of the task, so the execution happens effectively immediately. You can code them in two ways: By mentioning the time limit and the criteria for execution.

Mentioning the Time Limit

In this category, you will program the precise execution. For example, Brian will pay Lucy $100 on Tuesday. You can set this program on Saturday, and the money will automatically be sent to Lucy on Tuesday, and you won’t have to open any application or confirm anything. It saves time and prevents errors.

Mentioning the Execution Criteria

In this one, you will have to mention a particular condition the other person must meet before receiving their transaction. For instance, Brian will pay Lucy $100 if she doesn’t miss school this week. An Oracle that acts as a third agent will ensure that Lucy attends school for the whole week to receive her money. How it happens depends upon the users, but the criteria must be fulfilled for the person to receive the money.

Enhanced Security Through Immutability

Everything that resides on the Blockchain is immutable and set in stone. Once the required verification is done, no one can change or alter the data. This increases the security of the stored data units and saves them from hackers and malicious users. There are copies of the document made to ensure no changes in the original document. 

Replacement of Third Parties

As you have all the data controller, you can automate the transactions by setting whatever criteria you want without requiring any other person to do that for you. Of course, it will require detailed information about how the program works, but it will be a one-time requirement of knowledge. Once you know what to do, you won’t have to pay extra to any broker, lawyer, or third-party application.

Conclusion

If used for the proper purposes, smart contracts will be revolutionary in changing the banking and financial systems of the bitcoin profit way. They have shortcomings that can be improved with time as this is still a new technology. Automation helps to save time, makes processes fast, and prevents errors. It’s time for simple processes to be automated, giving people time to do stuff other than waiting hours to receive their transactions.