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What is a smart contract?
A smart contract is a computer program or transaction protocol on a blockchain that self-executes when certain conditions are met. Most listeners probably know about the Bitcoin blockchain created by Satoshi Nakamoto, who basically introduced a decentralized digital payment system. That’s why everyone is really excited about this technology from Ethereum founder Vitalik Buterin.
Buterin envisioned introducing more advanced applications such as financial derivatives for decentralized exchanges, blockchain identity and reputation systems. He originally wanted to do it on the Bitcoin blockchain, but due to the Bitcoin blockchain’s inherent limitations, it was not possible. So he went ahead and developed his own blockchain called Ethereum.
This blockchain basically allows the creation, deployment and execution of any currently known deployment of smart contracts. Today, when we talk about smart contracts, we are in the world of Ethereum.
How do smart contracts work? What makes a contract “smart”?
The first thing we need to do is create a contract account on the Ethereum blockchain. This is different from the crypto wallet account that most people think of when talking about accounts on blockchain systems. So we are basically saying that contract accounts cannot use cryptocurrencies to exchange cryptocurrencies.
Ether exists on the Ethereum blockchain, but you need to create another account called a contract account. Once that’s done, you’ll need to write your own computer program using solidity. This is a specific type of programming language that Ethereum uses. Hire a software engineer to help you translate certain terms from natural language into computer language, or if you have the ability to learn about time and robustness, learn how to do it yourself and make your own smart You can create a contract.
As smart contracts become more available and popular, will writing and coding smart contracts become easier in the next few years?
Based on conversations with several software engineers who work on smart contracts on a daily basis, the standards that Ethereum has in its own blockchain system seem pretty straightforward to software engineers. Basically, as simple as one of the limitations of the Ethereum blockchain, smart contract technology is very simple.
What are examples of smart contracts in action?
As an example, write a program that runs an auction as if you were running an auction to buy a particular item on eBay. We will first define the types of digital assets that will be auctioned, then write various functions to run the auctions. There is a function to have participants bid, and if the highest amount comes, that person will be the highest bidder. There will also be a function to indicate that this auction will end at a certain time. Finally, the highest bidder wins when the auction ends.
The content of this article is intended to provide a general guide on the subject. You should seek professional advice for your particular situation.
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