As cryptocurrency continues to grow in popularity and more people are becoming aware of the opportunity, additional subsets of blockchain are emerging and offer solutions to complex business challenges. One such emerging form of blockchain is helping people take complex challenges and create safer, more efficient automation. Smart contracts are computer programs built on a blockchain. Essentially, a smart contract can be programmed to complete any number of steps after the transaction is recorded. Whereas cryptocurrency is simply recording that a transaction has taken place, smart contracts allow for additional steps to take place following the transaction.
Much like “If this, then that” (IFTT) coding creates automated processes in technology, smart contracts can be completely customized to perform an unlimited number of sequences and scenarios. The added security of being build around blockchain differentiates a smart contract from other automation and allows more tasks to be completed in the cryptocurrency ecosystem. While many examples of smart contracts will never be visible to a consumer, smart contracts have a real chance at changing major e-commerce websites like eBay, and even entire industries.
Forbes magazine contributor, Joel Comm, explains that real estate escrow accounts could benefit greatly from smart contacts. “A property buyer would purchase tokens and send them to an address on the blockchain. The funds stay at that address until a computer program acknowledges that all the required steps in the purchase process have been completed: entering a code on a title deed, for example, or uploading a house inspection certificate or a signed copy of the contract. Once the transaction has met all its requirements, the tokens would automatically be released to the seller, who could convert them back into fiat currency.”
In many industries and business transactions that require a middleman, smart contracts present an opportunity to remove the need for a third person, while also providing a secure and quicker outcome. What currently looks to be just an interesting trend, could be a part of our day-to-day lives in the very near future.