The phrase "Smart contract” sounds literally ironic and contradictory. "Smart" is usually a word to show how something can be done in a better way with less energy or stress. It signifies that an individual is wise, and all general good attributes one can use to describe a "Solomon" kind of man. The word contract over the years when mentioned depicts ambiguity. When someone says, I just signed the contract; it signifies something huge that usually takes stress to achieve. Contract in our world are goals that individuals, creatives, and companies seek to use in a positive way to describe their business life. The process of a contract therefore definitely contradict being smart. Having the two words as a phrase is putting sugar and vinegar in a bottle.
A smart contract can simply be defined as a way of making agreement automatically fulfill or nullify themselves. Usually, when two parties have a contact, there can be a case of a breach in the agreement. A party to the contract can default. It, therefore, means that the other party who was faithful to the contract is left to fend for himself. If the contract has a penalty attached to it for defaulters, the unfaithful party in the contract is made to dance to the music. Making the unfaithful party dance is usually not so easy, to every contract there is always a third party who serves as an arbitrator between the contracting parties. He does the work of making sure everybody honors their agreement. It is a bit common to have a third party breaching the agreement of the contract to favor himself or give a particular party in the contract an undue advantage.
The concept of smart contract development seeks to make every party committed to their contract by locking in a set of encrypted do's and don'ts or rules and regulations which guides a contract and its members. The locked-in rules are usually in a carrot and stick approach. When a party obeys the agreement, they get a carrot, the reward for being faithful to the contract, but when they disobey they get a stick knocked on their head, the reward for being unfaithful to the contract. Depending on how the contract is written, a party could get a stick while the other gets a carrot. They could both get carrots for dinner if they both obey the guiding principles of the agreement or they both get flogged with the stick if they both turn out to be unfaithful. The juicy part in a smart contract is that the third party is the blockchain technology which locks the agreement in an encrypted lock and automatically rewards or reproach. Unlike the human arbitrator, the blockchain cannot be bribed or influenced in any way to favor any part of the contracting party.
Again, smart contracts are encrypted digital agreement between two parties on the blockchain network which holds contracting parties to their agreement and in the event that that obeys or turns unfaithful, it deals with them accordingly in an immediate instance. It eliminates the use of a third-party.
HOW SMART CONTRACT WORKS
The working of a blockchain smart contract is simple. Contracting parties both log on to the blockchain network with their verified information. The parties create an agreement to which they both must have decided is fair to them. The body of the agreement and its terms and conditions are uploaded into the network. The parties get to decide what happens to defaulters and what reward faithful parties get. All of these are uploaded unto the blockchain network. The framework of the blockchain smart contract gives a period to reminisce over the agreement again, probably a few days. After the reminiscing period, contracting parties click the "I agree" button. Once all parties click the "I agree" button, the contract becomes valid. Until all the contracting parties agree, the blockchain system does not take the agreement in.
For example, Mr. A gets into business with Mr. Q. They'd both agreed to supply each other information in their agro-consulting job. Mr. A and Q then sign unto the blockchain network provided by a smart contract development service. Their valid information and data are stored on the platform which means they are not bots or pseudo Individuals pretending to be who they are not. Mr. A and Q draft the terms and conditions to their contract and then uploads it on the network. They also provide the reward and reproach which serves faithful and unfaithful party a deserving portion. The carrot and stick they presented were to lose money when a second pass without sending credible information to the other party. The agreement got locked in when they both clicked the "I agree" button after their reminiscing period, and boom! the agreement is set. The money that they could lose or win is already present on the blockchain most assuredly in the form of a cryptocurrency and so the system rewards them accordingly to the specification of their agreement.
The moment Mr. Q doesn't send in his quota of information, Mr. A gets rewarded the same minute for it. Not going to call on a third party or digging out agreement papers in preparation for a lawsuit.
SMART CONTRACT DEVELOPMENT SERVICES
Blockchain Smart Contract development services are platforms where the Smart contracts can be executed on behalf of parties. Since everyone doesn't have the skill set to build a blockchain smart contract platform (plus the fact that it's totally unnecessary to), smart contract development service platforms are therefore available to cater for the need of contracting parties. There are lots of these smart contract development providers in the market that even the market is almost becoming saturated. It is therefore important for individuals and companies in need of the service to do their due diligence and background work to select which of the blockchain smart contract development service will suit their need and properly represent the interest of all contracting parties.
Expertise in blockchain smart contract development is rare, finding firms that have proactively adopted the technology, built their own solution and implemented use-cases should be the focus of intending users.