By the end of 2021, the smart contract market generated revenues of $150.2 million, and by the end of 2032, those revenues are expected to reach $1,515.4 million.
Given how popular smart contracts have become, there’s a chance that learning more about them will make you want to know more. The success rate of smart contracts will be crucial for the development of Web 3.0 in the future.
Going back in time, smart contracts were first developed in 1994 by Nick Szabo, an American computer scientist who was also known as the creator of the virtual currency known as “Bit Gold.” What might, however, be the accurate definition of “Smart contract”?
What are Smart Contracts?
A smart contract, often referred to as a crypto contract, is a computer program that is used to settle contracts between parties by automatically and directly regulating the movement of data pertaining to digital assets between them under certain conditions.
Smart Contracts vs. Traditional Contracts
Similar to traditional contracts, smart contracts function in a way that works on automation but doesn’t allow eventual mutation.
Traditional contracts are legally binding but smart contracts development are created and implemented using codes and programming languages.
How do Smart Contracts Work for Multiple Blockchain Platforms?
Concerning the above-mentioned information, smart contracts development is a ground-breaking layer that allows users to communicate, and transact via a robotic middleman utilizing blockchain technology.
The most significant leading factor that makes smart contracts more reliable and authentic to pursue is that they initiate automated tasks and host decentralized apps. Now users can easily create their smart contracts using a simple and easy interface of blockchain-based platforms.
Here are the most prominent smart contracts platforms based on blockchain technology:
Introduced in 2013, Ethereum is widely known as a decentralized platform that allows the effective execution of smart contracts.
Ethereum was the first ever platform earlier that created complete languages like Serpent, Solidity, low-level lisp, and Mutan to serve cryptocurrency user applications.
It converts these language contracts into machine code and loads into Ethereum Virtual Machine then executes it. In this platform, smart contracts ensure an account-based data format where each valuable user is identified by their digital wallet.
Ethereum’s stock market capitalization is far and beyond the reach of its competitors’ range. In mid-2023, it reaches $223 billion, combining sources of the majority of smart contracts platforms.
Ethereum is always the top choice for developers who are willing to join the largest ecosystem for smart contracts.
There is a huge count of smart contracts development platforms that are already on board and working well.
Maker DAO and Compound use smart contracts are Ethereum-based smart contract creators allowing users to lend and earn interest.
Polkadot, one of the most brilliant smart contract ecosystems developed by Gavin Wood, co-founder of Ethereum, Created by Parity Technologies, a software development company, is now the fifth-largest cryptocurrency project based on blockchain networking.
The platform from Polkadot can operate several chains inside current blockchains. Because of its adaptability, parachains can incorporate several features at once, including smart contracts, ZK snarks, UTXO transactions, and other decentralized technology.
Relay Chain is an integral component of Polkadot’s interoperability of parathreads and parachains.
Developers can design custom tokens and governance models using Polkadot. Scalability and transaction processing in parallel is promoted by using parachains as shards. For connecting parachains to external blockchains like Ethereum, this platform provides bridge chains.
Polkadot’s Ethereum-compatible smart contract platform, Moonbean, enables programmers to make use of the solidity-based smart contracts connected to Moonbeam.
Solana is based on a collection of 2017 software from companies like Intel, Dropbox, and Qualcomm.
A new generation of smart contract platforms has been developed with the goal of overcoming scaling issues. 65,000 transactions were recorded every second by Solana.
The most innovative consensus algorithms, including Proof of History (POH), Proof of Stake (POS), Tower BFT, Solana clusters, Gulfstream, Pipelining, Turbine, and Sealevel, are combined.
Instead, transactions are often recorded in their own blocks, grouped together, and used as input for subsequent transactions.
Smart contracts may be processed concurrently in Solana with its advanced technologies, like sea level. This technology makes this platform one of the fastest and most appealing for Dapps that need immediate output.
People are counting on inventive, technology-focused knowledge and need constant performance regardless of the network load, making Solana a popular choice.
Avalanche is a safe, quick, programmable, and interoperable smart contract platform that enables users to create unique blockchain applications. It contains three built-in blockchains that are appropriate for various needs.
Exchange Chain: This chain is used to administer and manage trades in assets and transactions.
Platform Chain: To manage validators, coordinate, and establish subnets
The Ethereum Virtual Machine’s Contract Chain is used to create smart contracts.
With a cost of $0.0003, Algorand’s smart contract technology enables 6,000 transactions per second. This platform uses Pure Proof of Stake (PPoS), a restricted method that gives any user a chance to be chosen as a validator.
Alogrand ensures the highest level of security and privacy. It enables the creation of smart contracts by developers in Python or the Transactions Execution Approval Language (TEAL).
This platform has its own smart contract execution environment, named Algorand Virtual Machine (AVM).
6. Hyperledger Fabric
Based on distributed blockchain technology, hyper ledger fabric is also used to run smart contracts. On this platform, smart contracts execution is denoted as chaincode and is written in Go.
Alike Ethereum which uses virtual machines to formulate smart contracts, fabric uses a docker container to run the code.
Three alternatives are available to developers when building apps with Hyperledger. The Java SDK, the CLI, and the Node.js SDK. The network typically hosts Fabric’s chaincode and smart contracts, which are recognized by name and version.
Fabric’s networking is based on private permission, accommodating broad enterprise applications. Before joining its network it requires certificate authorization and approvals.
Focusing on digital currency applications, Corda is known as a distributed ledger platform for storing digital databases, assets, and past information. Corda’s smart contracts work on Java Virtual Machine(JVM) and use efficient programming languages like Java and Kotlin. The data of smart contracts of Corda is stored in the ContractState S on a ledger.
Corda is generally used to enable private platforms, where businesses can create secure and private platforms for digital assets exchange. It works on a consensus algorithm name Raft for quick consensus on private blockchains.
Stellar is a specialized and advanced platform for digital currency applications. This is a more accessible and easy cryptocurrency to get. It supports an extensive range of languages including Java, Python, Golang, and PHP.
Stellar’s smart contracts are a collection of connected and executed transactions utilizing diverse constraints to design, send and ensure trading value.
Stellar’s smart contracts combine transactions with a variety of restrictions that must be met to get the desired result.
The Sorobon platform for smart contracts, created by the Stellar Foundation, enables the development and implementation of smart contracts via networks.
9. Rootstock (RSK)
Rootstock is one of the general-purpose smart contract platforms secured by Bitcoin networking. It was started by RSK Labs to address Ethereum’s limitations and give Bitcoin more stability.
The need for any intermediary to enable a transaction is not necessary with RSK’s smart contracts because they are completely autonomous. RSK works with the majority of the biggest Bitcoin exchanges, enabling and completing transactions in less than 20 seconds.
RSK uses Solidity to create smart contracts and creates its virtual machines for smart contract execution. Even though RSK is a public blockchain system, it operates on an account-based data system.
What are the Benefits of Smart Contracts?
Smart contracts are trustworthy because of several irrefutable and verifiable characteristics. They are also well-designed using automated contractual coding to obligate parties to behave ethically and uphold equity in all upgraded decisions.
Resolute: In this contract, each contracting party has a guaranteed copy of all conditions that cannot be changed or altered in any way, maintaining reliability and trust in the platform.
Deterministic: Smart contracts have a unique specification as they work only for those for whom they are designed after meeting all required conditions. In any scenario, the outcome will remain unaffected.
Immutable: Once the information and details have been deployed and confirmed by the parties, the contract cannot be changed or altered in any manner; it can only be removed as long as the necessity disperses.
Autonomy: Smart contracts don’t involve any other parties. These are created exclusively for certain parties and shared between two; there are no intermediaries involved who could disclose or authorize any information. These operate over network nodes and take control power away from any outside source.
Customizable: These contracts allow parties to add their custom negotiations, requirements, expectations, or progress graphs, adding modifications before launching them finally.
Transparent: Forming strict equity on the platform, smart contract development codes are visible to everyone and stored on a publicly distributed ledger identified as a blockchain.
Self-verified: Smart contract development is self-verified due to automated possibilities and blockchain technology.
What is the Process of Smart Contract Development?
Understanding the development of a smart contract can be easier or harder depending on where you are in the process.
Identify Agreement: Smart contracts should have their purpose, cooperative opportunities, and desired outcome regarding business expansion, asset wraps, and others.
Set Conditions: These contracts can be generated by the parties themselves once the conditions are fulfilled by them, including all finance, events, and other specific details.
Code Business Logic: Smart contracts are generated automatically and written well as long as the conditional parameters are met effectively.
Encryption and Blockchain Technology: Smart contracts provide more secure authentication and circulation of information between parties.
Execution and Processing: In blockchain integration, once the parties reach a consensus, the codes are executed regarding authentication and verification of details memorialized for verification and secured processing.
Network Updates: After the finalization of the smart contract, all the nodes on the network update their ledger posted and verify details, as they cannot be modified afterward.
Why Smart Contract Development is Relevant for Companies?
For an organization, trust, and reliability are among those significant factors that can be breached and are always at risk if there is involvement of any third parties.
Eliminating or eradicating the risk from the root, smart contracts are safe, and transparent between parties.
As there is no possibility to alter and mutate the data they are widely accepted by an organization to protect the primary information they can’t afford to disclose.
All in All
Given the current situation, it is imperative for businesses to store their data in a secure ledger and have contracts that are safe so that there is no danger of information leakage when they are engaged in a fiercely competitive race.
Blocktech Brew is a top-tier blockchain and smart contract development company with professionals who are flawless and intelligent in building reliable Blockchain apps, dApps, Digital Assets, NFT, Defi, and interactive 3D metaverse platforms that meet modern criteria.
To enhance and strengthen an organization’s privacy and security, you can engage smart contract developers here with decades of experience and competence who provide excellent approaches and quality smart contract development services.
I am the CEO and founder of Blocktech Brew, a team of blockchain and Web 3.0 experts who are helping businesses adopt, implement and integrate blockchain solutions to achieve business excellence. Having successfully delivered 1000+ projects to clients across 150+ countries, our team is dedicated to designing and developing smart solutions to scale your business growth. We are focused on harnessing the power of Web 3.0 technologies to offer world-class blockchain, NFT, Metaverse, Defi, and Crypto development services to businesses to help them achieve their goals.