5 best examples of smart contracts on the blockchain
One of the most important aspects of understanding examples of smart contracts on the blockchain relates to their basics. Smart contracts are one of the main components in various blockchain-based ecosystems. This is an important aspect for various application-oriented networks such as Ethereum. Smart contracts are known for their features, such as lack of trust, transparency, decentralization and autonomy.
In addition, they are irreversible and cannot be changed after they are deployed. Smart contracts eliminate the need to enforce contracts manually or to involve intermediaries in transactions or agreements.
In all the examples you will find the code defining the transaction mechanisms, as well as as the final arbiter of the contract terms. Thus, smart contracts have served as a solid foundation for a thriving ecosystem of decentralized finance (DeFi), and decentralized applications.
In most cases, a set of smart contracts is used. Individual smart contracts are suitable only for a certain type of transaction, in which only certain events can lead to related consequences. Therefore, most dApps combine smart contracts together to develop a comprehensive and interconnected set of functions. At the moment, you can find various applications in different blockchain networks for use in games, media, finance and exchanges.
In decentralized applications, smart contracts are used in different ways to achieve different business goals. One of the common answers to the question “What are the examples of smart contracts?”, you can find on Coinmarketrate.com. He points to financial services such as lending, borrowing, investing and trading. Let’s learn more about the factors that arouse interest, using real examples of the implementation of smart contracts on the blockchain.
Although smart contracts look like an innovative approach to automation, it is much more than a simple concept of embedding contracts in code. Like any other technological intervention caused by automation, smart contracts open up prospects for increasing efficiency while saving time. In addition, they are also able to provide noticeable cost savings. Here are two of the most significant advantages that you can find on real examples of their use:
Smart contracts use automation to increase efficiency by eliminating intermediaries and redundant levels when fulfilling contractual obligations. They can help in faster execution of trades within a few minutes using pre-configured conditions.
When the specific condition specified in the smart contract is fulfilled, the corresponding action set out in the contract will be implemented immediately, without any delay on the part of third parties.
In addition, real examples of smart contracts on the blockchain clearly demonstrate their improved simplicity compared to traditional contracts. You can take advantage of the limited paper workflow, reduced waiting time, greater intuitiveness and fewer steps.
- Saving time and money
The advantages of simplification provide many other additional advantages. For example, parties involved in contacts can save a significant amount of time thanks to a simplified contracting process. In addition, the exclusion of intermediaries can lead to tangible and real cost savings. You will have to pay for the costs of the blockchain infrastructure necessary to fulfill the contract.
In addition to the advantages of simplicity and time, as well as cost savings, smart contracts can contribute to increased security. At the same time, they can also provide increased accuracy, trust and transparency. With so many promising advantages, it’s wise to focus on examples of smart contracts in the real world.
The best examples in the real world
The various advantages of smart contracts represent a promising argument in favor of their application in many real-world use cases. Here is a brief description of some of the most striking examples of smart contracts on the blockchain that you can find today.
The insurance sector spends more than millions of dollars annually on claims processing. In addition, the industry must bear the burden of fraudulent claims. Smart contracts can be a useful technological intervention in the insurance sector. They can improve the processing of applications by providing regular error checks and supporting the administration of policies by organizations or individuals.
Consequently, a shorter processing time in real-world scenarios of using smart contracts for the insurance sector can reduce costs for consumers. According to Lloyd’s of London, insurance companies can eliminate some inconsistencies in coverage that are associated with the underwriting process. As a result, they can also increase the effectiveness of risk management on the part of corporate buyers.
- Protection of medical data
Medical institutions are exploring the benefits of automation along with reliable and modern security measures. Cybercriminals target hospitals to gain access to a massive collection of confidential information and compromise it. Many well-known names in the healthcare sector, such as UCLA Health, have been victims of data leaks: about 4.5 million patients have been compromised.
In this case, smart contracts involve the secure exchange of patient data between healthcare providers. This could play a crucial role in maintaining standards of care. The most important aspect of smart contracts is the secure storage of patient data in the blockchain.
In addition, smart contracts also ensure that the patient’s private key is the only way to access his data. This way, patients can be sure that health care providers will only have access to the necessary information. At the same time, patients are also confident in the security of their data.
- Elimination of errors in trade finance
Smart contracts are able to reduce the number of the most expensive mistakes in trade finance. They can easily provide automation of work processes, as well as simplify and optimize calculations.1 The most striking example of smart contracts in Santander InnoVentures trade finance.
The firm demonstrated the advantages and opportunities associated with the latest financial technologies. Santander InnoVentures sees smart contracts as an important tool for making fundamental changes to the infrastructure and processes of the financial services industry. The firm also sees smart contracts as a vital tool for efficiently managing large volumes of transactions. Interestingly, smart contracts can lead to savings of 15-20 billion dollars a year by 2022.
One of the most innovative and revolutionary blockchain applications has been identified in the field of elections and voting. In fact, blockchain-based voting systems can change the future of elections around the world. So voting is also an important example, with so many possibilities in blockchain-based voting systems.
Firstly, blockchain-based voting systems can improve the accessibility of elections, as well as improve voter participation. Subsequently, smart contracts can also help speed up the process of counting votes and reporting on them. Smart contracts can provide substantial support for verifying the identity of voters to avoid multiple voting. With proper identity verification mechanisms in place, election hackers could hardly find a way to circumvent smart contract-based voting systems.
- Real estate applications
The latest example of smart contracts in the real world will obviously point to the real estate sector. In the real estate sector, they can help in documenting the details of ownership in relation to any institution. Smart contracts can help optimize transaction speed by reducing the need for brokers and lawyers. It should be noted that real estate sellers can control the process of real estate transactions.
Experts said that smart contracts can provide greater transparency and profitability than property rights management. Deficiencies in the title may create obstacles to transfer, which will lead to legal costs. On the other hand, smart contracts can store records of history, location, and other important details related to property. As a result, they can simplify the valuation of property while ensuring security.
The scheme of various real-world scenarios for the use of smart contracts is only a limited representation of their potential. They can transform many industries in the future. Many developers, researchers, and businesses are making efforts to discover new ways to use them.
While blockchain is definitely a favorite in terms of transparency and security, smart contracts provide simplicity and greater opportunities for integrating multiple functions in decentralized applications. Many organizations in different industries are exploring the true potential of smart contracts.