Blockchain Smart Contracts: Benefits and Application - Specksblog

Smart Contracts! What does this really mean? You don't have any idea, right? Don't fret! In a matter of minutes, I'll explain what smart contracts are, their application in real life, and their benefits.  To begin with, blockchain technology has revolutionized the world so immensely since its inception. Thankfully, the blockchain technology market has grown to prominence in recent years. With the emergence of new governance tokens, NFTs, and decentralized autonomous organizations (DAOs), individuals from all walks of life can leverage any of this ecosystem to create a life-changing moment. Equally, new blockchain-based applications, games, NFTs, and decentralized finance (DeFi) - a typical example is UMOJA Protocol; you'll read more about UMOJA later in this article.
Blockchain Smart Contracts: Benefits and Application

What Is A Blockchain Smart Contract?

Smart Contracts are programs stored on a blockchain network; they run when certain conditions are met. For many reasons, smart contracts work on a blockchain network instead of a personal computer, machine, or server. Additionally, they do not require human interference to verify or enforce conditions.

Over the years, different applications have been developed on these smart contracts platforms; the most popular Dapp lying on smart contracts is DeFi - here, individuals can trade digital assets anonymously, and borrow and lend cryptocurrencies seamlessly. Unlike traditional institutions which have any restraint.

What Are The Benefits Of Smart Contracts?

  1. Adequate Transparency and Security:

  2. A great benefit of smart contracts is that they offer enhanced transparency and security - even without third parties, they ensure immutability and adequate transactions on a blockchain network.  Because smart contracts are transparent in nature, they allow anybody to view and verify transactions whilst eliminating mistrust and the need for middlemen, intermediaries, or government.
  3. Cost Savvy and Efficient in Nature:

  4. Smart Contracts do not rely on a third party before they can verify the terms of the contract; they were built to automate processes so that the need for manual intervention will be removed. These will maximally foster efficiency and save costs.  The inherent nature of smart contracts helps eliminate paperwork and organizational delays, thereby improving transaction time.
  5. Automatic Updates and Speed:

  6. Think of how much time is invested in contracts done manually and in the presence of a third party; the whole thing can be very overwhelming, right? Once the contract meets a condition, it executes immediately. More so, thanks to the autonomous nature of blockchain technology, which allows smart contracts to adjust and update automatically.

What Are The Applications Of Smart Contracts?

What's in it for organizations? A lot more than we think! In just a few short years, smart contracts already have a wide range of applications in various industries and still counting - let's explore some of the use cases.
  1. Voting Systems:

  2. Coming in hot at number one is voting systems - the inherent nature of smart contracts has the potential to revolutionize voting systems exponentially. Smart contracts - although written by humans - can ensure transparency, auditable processes, and tamper-proof which enhance trust whilst reducing fraudulent activities.
  3. Financial Institutions:

  4. Smart Contracts have played a lead role with respect to decentralized finance (DeFi). Gone are those days when people had to sign a lot of papers to get a loan; it's now a thing of the past.  With DeFi, anyone can buy, sell, trade, borrow and lend crypto assets, bringing us to UMOJA Protocol - one of the fastest-growing DeFi protocols that debuted a few months ago.

    UMOJA is a credit protocol for emerging markets that offer individuals access to global credit on their terms. The protocol intends to become the go-to lending protocol, especially for the African diaspora. UMOJA's goal is to democratize credit financing in Africa with DeFi. But to do that they need a community of like-minded and unrelenting talents (Shujaa) to help bootstrap the protocols milestone.

  5. NFTs and Gaming Industries:

  6. Just so you know, Web3 is making its debut in the gaming industry - the gaming industry is a billion-dollar ecosystem that has grown rapidly in recent years. The admittance of Web3 in the gaming industry will allow players to earn while they play their favorite games. For clarity, blockchain-based games are commonly driven by non-fungible tokens (NFTs) - NFTs are digital assets representing in-game content that rely on blockchain smart contracts. Because these NFTs are rare and indivisible assets, blockchain smart contracts facilitate player ownership, immutability, and interoperability. Thanks to the innovative admittance of blockchain technology in the gaming industry; as a player, you'll be able to save in-game assets that you won or purchased, you can sell them to other players, or even trade them in a marketplace. Players do not need to see each other before the transaction can initiate - the blockchain smart contract does all the work. I'm so blessed to be in the era of Web3!
  7. Blockchain Technology In The Legal Industry:

  8. One of the most promising real-life use cases of smart contracts is the ability to perform as "legally binding contracts." With technology, today's business engagements can overcome several friction points. Soon, smart contracts may be one of the suitable options for parties to legal agreements; these innovations will eliminate the cost of using lawyers and bodies. According to my research, marriage licenses can now be issued to intending couples in California via blockchain technology.

Final Words: Blockchain Smart Contracts: Benefits and Application

We have seen how the blockchain smart contract is changing the way we live - there are several use cases of smart contracts even in the real estate industry. With tokenization, smart contracts have enhanced the digital ownership of assets in the Metaverse. Many celebrities have purchased digital plots of land - when a piece of land is purchased, it can be tokenized and record keeping can take place on associated smart contracts which saves a lot of time and money.

Lastly, decentralized autonomous organizations (DAOs) are built on smart contracts; the smart contracts are responsible for encoding cooperate structures - with smart contracts, DAO members have the confidence to vote on proposals to drive the community forward, they ensure security and transparency, the votes cannot be manipulated or changed by any member.

About Frank Chukwurah


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