The contracts made among parties using Blockchain technology are called Smart Contracts. There are two types of Blockchain, public Blockchain and private Blockchain. Bitcoin, Ethereum etc. are public Blockchains. While some organization can have a Blockchain which is not open for public, they are private Blockchain. Smart contract can be hosted on any type of Blockchain. Public Blockchain are more trusted due to it’s transparency. Ethereum Blockchain is more popular for smart contracts than any other Blockchain. The Blockchain has a feature; data once entered can not be modified. Another data can be added.
Social Impacts of Smart Contracts
Every data transaction can be seen in public ledger but who transferred to whom remains undisclosed. Confidentiality of transactions always remains intact. Data security is the most famous feature of Blockchain technology. Blockchain data are hosted in millions of PCs at different locations of the world. This decentralization of Blockchain data makes it out of hacking. If a PC is attacked and data stolen then data will be of no use of hackers because of the cryptography encryption. And, that data can be recovered with the help of other active nodes in the chain.
The smart contracts can be between two parties indulged in business deals. By it when a condition will meet action defined will be taken automatically. Neither party can change the agreement made at the time of deal. This can be handy in commodity market, especially in margin trading. Where, in case of loss booking one party try to default the agreement. Smart contracts will prevent this case of defaulting and the transition will be smoother. Smart contracts save time and energy both in implementing an agreement. Everything becomes digitalized and automated.
In manufacturing units, a smart contract can be written like if a shipment reaches then payment gets released or likewise. Where ever agreements or conditions come, smart contracts can be implemented. This smoothens the whole process and no party can breach the contract. Normally a smart contracts development company uses ERC20 methodology if Blockchain Ethereum is chosen.