By now, the majority of us a well-aware of cryptocurrencies, the blockchain, wallet exchange platform, and wallet development, etc. Oh yes, the commoners may not know much about them, but whomsoever is working in information technology must know – may be the fundamentals only. Well, with Ethereum development, smart contracts are necessary to talk about.
Have you ever heard about smart contracts The smart contracts are self-generated codes on the blockchain that execute specific function upon the fulfillment of a particular criterion. For example, you want to rent a flat, and there is another member on the Ethereum network who want to rent out his flat. A digital contract is auto-generated in the system to deal with both the queries. The time all the thresholds are met like the accuracy of the flat’s address and the buyer has enough crypto coins for instant payment, and the deal will be closed between the two participants.
On a broader scale, businesses are turning to the emerging idea of free cryptocurrency market and open competition. It eliminates the need of intermediaries or third parties. This revolutionary technology has all the potential to help you with an instant and secure transaction of any size. The best attribute of blockchain development and smart contracts is that in case of failure of any criteria the process will revert. It means the funds will go back to the owner.
As in the rent-a-flat case, if the given address by the host (who wants to rent out) turns out to be wrong, then the money generated from the guest (renter) will be returned to his account on the blockchain.
Isn’t it amazing how blockchain and smart contracts keep you safe from all sorts of financial scams? Obviously! And, it’s the primary reason that corporate world is turning to the blockchain. Even the startups are looking for Blockchain Development Company to build and implement perfect systems to meet their business objectives.
Benefits of Smart Contracts for Businesses:
Online trading has its advantages, but digital trading in cryptocurrencies supported by blockchain technology is gaining unrivaled popularity.
Here i=s Why!
- Enhanced Efficiency:
Smart contracts as the name implies is a smart technology that eradicates the need of the third party as in case of traditionally executed business processes; especially in financial matters and customer support. These self-executed codes accelerate the efficacy factor of all sorts of business operations once they integrated with a professionally designed decentralized system. Moreover, it relaxes the company employees from any possible workload. It, again, helps with enhancing the efficiency of human resource.
- Cost Efficiency:
Now, this is the real thing. No business wants to break its bank on any additional cost such as in the case of a third party’s (e.g., bank) involvement in any business function. With the blockchain and smart contracts, companies can better control the cost. You do not need to spend on generating contracts, and there is no requirement of paying anything for online transactions (in the banking system you have to pay some fee). Blockchain networks are sort of one-time investment to keep you save from consuming funds on other channels (intermediaries).
- Direct Interaction:
Usually, the third party’s involvement in any business process creates a rift between the concerned people; i.e., the owner (top management) and customers. Smart contracts allow you to have clear and direct interaction with the target consumer base. All dealings are directly done between the service providers and the end users without relying on any other resource. It saves both your time and money.
- Irreversible Transactions:
Trust is the backbone of anything you do. There are many reliable payment modes such as PayPal (though not available globally) but it can reverse your payment any time, and you cannot do anything about it. And, even if you can the process is quite complicated. It is not the case with the blockchain-based business networks. Your money is secure in the system. Smart contracts ensure immutable and trustworthy business agreements. Your business funds are well-protected with blockchain and smart contracts.
As smart contracts are based on blockchain technology, they help to store all transactions in chronological order which is accessible to all participants in the network.