Curtailing the precariousness that the future awaits us with the acceleration of digitalization, blockchain has successfully revolutionized the commerce and trade scape. On the blockchain, smart contracts have significantly simplified business and trade between anonymous and identified parties, where there is no need for a middleman anymore. It narrows down the cost and formality, unlike traditional methods, and extends robust credibility and authenticity.
In this blog, we will look at some real-time applications or uses of smart contracts blockchain, but first, let us look back on the concept of smart contracts and blockchain technology or blockchain-based ecosystem.
What is Blockchain and Blockchain Ecosystem?
Blockchain is a highly evolved computer network that records information and encrypts it using intricate mathematics and elaborate coding, making it impossible to change, cheat or hack the system. In short, it is a digital ledger in which the recorded information is duplicated and then distributed to the entire network of computer systems, thus called the blockchain. The group of elements that interact with each other and the surrounding world or the network of different participants in the blockchain together make the blockchain ecosystem.
What are Smart Contracts?
In a smart contract, the contract is a self-executing one, which means that the terms of the agreement between the buyer and seller are directly encrypted in the code and therefore the agreements exist in the distributed and decentralized blockchain network.
As simple as the concept is, it has revolutionized transactions and contracts between individuals and institutions today as we shall see ahead.
Real-time Applications of Smart Contracts and the Blockchain Technology
A smart contract is a “contract that carries the digital signature as a computable agreement between two or more divested parties”. A virtual third party, a software agent ideally, can enforce the contract and execute it to a certain extent in a secure manner. For example, if the encryption technology works in an “if and then situation” program, then if an insured item meets an accident, then the insurance claim is paid. The smart contract technology will dispense the claim amount without any human interaction since the information is deemed secure and automatically generated. Private Blockchain, a form of blockchain mechanism which only allows, invited users to participate, see and use the information can also be used for this purpose.
This brings us to the concept of NFTs or Non -fungible tokens that are a way of registering a unique image, video, real estate, or any form of digital item, or physical item on a blockchain. This has made its way to the gaming industry which is a hundred-billion-dollar ecosystem today where the Developers make and release games, and players pay to play and interact with those games through in-app purchases and assets. This has created a one-directional flow of value where players spend money to unlock access to in-game assets and gameplay configurations. Blockchain enables players to capture the utility and value of in-game purchases and asset acquisitions more effectively. Now one can save in-game purchases, sell them to other players, or move them into other supported games.
Did you know that the United Arab Emirates (UAE) has been developing blockchain-based land title registry projects? Yes, you read that right. Smart contracts are enhancing the fractional ownership of assets by curtailing the limitations posed in the circuit of investment. Platforms like SolidBlock and RealT have infused blockchain and real estate assets through tokenization. Furthermore, documentation and transaction processes are simplified by smart contracts, which also brings efficiency in terms of time, cost and transparency.
In the germination of blockchain technology, little did anyone think that someday blockchain will have the ability to compute and facilitate complicated tasks of artificial intelligence and machine learning. While the rudimentary smart contracts are not enabled to widen their scope, if AI-enabled smart contracts are created then they can accommodate and acclimate with new roles making the smart contracts more custom-based, more responsive, and more focussed on the needs of the enterprise. With the AI-powered ceaseless automation of execution and security and decentralization of smart contracts or dApps. blockchain has the potential to create a highly advanced genome with unprecedented computational capabilities.
That being said, it is unequivocally conclusive that, smart contracts and blockchain and their application have the potential to change the transactions of our everyday life altogether. If you are looking for a blockchain development company in Dubai, you’ve come to the right place. Get in touch with Nuox Technologies and Let’s talk about how we can help.