The Blockchain Technology That Will Disrupt Third Parties

Tag: Smart Contract rules (Page 2 of 2)

Is a ‘smart contract’ really a smart idea?

Swift developments in the emerging field of blockchain technology have facilitated the birth of ‘smart contracts’: computerised transaction protocols which autonomously execute the terms of a contract.

Smart contracts are disintermediated and generally transparent in nature, offering the promise of increased commercial efficiency, lower transaction and legal costs, and anonymous transacting.

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Smart Contract, a Self-Enforcing Agreements

Would you enter into a contract with someone whom you’ve never met, and therefore don’t know and don’t trust? Would you become an investor in a small company in a foreign country? Would you agree to lend money to a stranger, like a farmer in Guatemala, a teacher in China, or to a cashier in the UK? Or would you set up a legally binding contract for a 1 EUR-purchase over the Internet, like buying a song from an artist? The answer in all of the above-mentioned cases is probably no, as the cost of setting up the necessary legal contract to secure your transaction is too high. We either don’t enter into such a contract at all or use trusted intermediaries to settle such contracts, paying them substantial settlement fees for their services.

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