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of the month Fintech Times We take a look at why digital currencies are gaining popularity. It also reveals emerging alternatives to cryptocurrencies and the use of blockchain technology. Plus, we’ll explain why the digital future looks so compelling.
This week we will be looking at smart contracts.Start with today’s insights Injective Labs, Quanloop, Insurist, Sooho.io When Planet IX.
according to Eric ChenCEO and co-founder of Injective Labs, an R&D company focused on creating unparalleled decentralized financial solutions, smart contracts to effectively change the way users enter and execute contracts. , innovative.
Agreements between two or more parties have terms that need to be made, and usually an arbitrator who oversees the validity of said agreements and trusts them to be enforced.
However, users are prone to human error. Structured terminology can cause friction, and arbiters can become unnecessary centerpieces. Trust is not only subjective, it can also be broken.
By allowing trusted intermediaries to be logic coded and code to be law, smart contracts obviate the need to have trusted intermediaries when transactions take place. Users can trust the code to execute their terms and significantly accelerate their trading activity, so there is no ambiguity regarding the trades they are executing.
Initially, smart contracts served to execute a single transaction between two parties. It is now logged, validated, and verified across multiple networks, not just blockchains.
Smart contracts are bringing about a real paradigm shift. We have contracts that we use every day, such as mortgages, rents, and financial transactions. Given that, over time, all these transactions will take place on decentralized blockchain networks such as Injective.
for Valentin Ivanov For the Estonian financial expert and fund manager at investment firm Quanloop, smart contracts are nothing new.
Smart contracts are nothing new. In fact, people often cite vending machines as the first kind of technology similar to implementing smart contracts, he suggests.
Though not new, smart contracts are still revolutionary because they can reduce the need for third-party mediation, the cost of legal disputes, fraud damages, and the potential for unintentional or intentional breaches. There is no need for a trusted third party to approve smart contract execution.
Smart contracts work where there is no need for a neutral third party to validate the agreement, such as OTC derivative trading or contract execution when changes are notified. Smart contracts are commonly associated with cryptocurrencies and are the basis for Ethereum’s decentralized finance and NFT applications.
For example, a smart contract may be used to transfer ownership of a property once an agreed amount is credited to a bank account. This works well with self-executing contracts where actions are performed after certain conditions are met. Due to the direct nature of valid payments, no other party is required to effect the cash transfer.
Airlines Adopting smart contracts to build a passenger entitlement payment system, compensation could be paid automatically in the event of delays.
felix bengson, the chief marketing officer of the WEB3 NFT-based strategy game Planet IX, also participates in the vending machine comparison. “You plug in your token, and something happens in the black box, and the feast comes out. The point here is that it doesn’t matter who you are, as long as you plug in your token.”
He also said that smart contracts will replace legal staff, back offices of financial institutions and insurance agents.
What used to be more or less arbitrary decisions by corruptible humans will in the future be solved simply by smart contract code that regulates the relationship between customers and service providers. It’s the way to go.Fair and efficient.There are countless examples of transactions like this we do on a daily basis, but today we make the final decision, file the paperwork, move the money. and requires a human to transfer its ownership.
More than this can and should be handled by transparent, permissionless code. This is the world smart contracts promise.
Smart contracts eliminate the need for middlemen, explains Brian Greenberg Insurance company CEO and founder insurer. This means you can do business with anyone in the world without worrying about getting scammed or losing money through fraud.
You can set up smart contracts to only happen when certain conditions are met, meaning no one can take advantage of you or your business.
Smart contracts are very revolutionary because they allow us to do business with people we don’t know and allow both parties to get what they want out of the transaction.
Proper implementation of smart contracts increases security and transparency. Jasper Lee, Audit Technical Lead at Sooho.io, a DeFi infrastructure services provider. With the rapid rise of his DeFi in recent years, there has also been a corresponding increase in security challenges as hackers target vulnerabilities in such platforms and protocols.
With record-breaking funds stolen from DeFi platforms in 2022, we can even say the security situation is dire. That said, the majority of smart contract vulnerabilities can be easily avoided. Our recommendation for companies doing so is to ensure that comprehensive security audits are conducted and the recommendations from those audits are fully implemented.
We hope the industry can commit to greater implementation of security checks to achieve greater success in this area.
