Smart contracts help you exchange money, property, shares, or anything of value in a transparent, conflict-free way, while avoiding the services of a middleman.

What are Smart Contracts?

The best way to describe smart contracts is to compare the technology to a vending machine. Ordinarily, you would go to a lawyer or a notary, pay them, and wait while you get the document. With smart contracts, you simply drop a bitcoin into the vending machine (i.e. ledger), and your escrow, driver’s license, or whatever drops into your account. More so, smart contracts not only define the rules and penalties around an agreement in the same way that a traditional contract does, but also automatically enforce those obligations.


Suppose you rent an apartment from me. You can do this through the blockchain by paying in cryptocurrency. You get a receipt which is held in our virtual contract; I give you the digital entry key which comes to you by a specified date. If the key doesn’t come on time, the blockchain releases a refund. If I send the key before the rental date, the function holds it releasing both the fee and key to you and me respectively when the date arrives. The system works on the If-Then premise and is witnessed by hundreds of people, so you can expect a faultless delivery. If I give you the key, I’m sure to be paid. If you send a certain amount in bitcoins, you receive the key. The document is automatically cancelled after the time, and the code cannot be interfered by either of us without the other knowing, since all participants are simultaneously alerted.

You can use smart contracts for all sort of situations that range from financial derivatives to insurance premiums, breach contracts, property law, credit enforcement, financial services, legal processes and crowd funding agreements.


okay guys we talk about smart contracts

but I do want its first state a

disclaimer disclaimer number one I’m not

a coder developer okay so I’m not

talking about the logic silly here I’m

not talking about programming language

such as solidity and disclaimer – this

is a non-technical video so I’m trying

to die still and synthesize all this

technicality it’s a simple language that

everybody can understand so without

further ado now the disclaimer is out

there I shall begin so the million

dollar question what is a smart contract

well a smart contract first of all

should not be called a smart contract I

think at least right now this current

state should it should just be called a

contract see a smart contract is nothing

more than certain computer code built

within to the blockchain cryptocurrency

network that computers or the nodes

execute and that once the computers the

nodes execute this contract they update

the ledger so if you guys are familiar I

love working on analogies or contrast

where you can actually build your

knowledge based on some pre-existing

notion such as a schema so for example

when we talk about smart contracts let’s

first relate to something that you might

be well aware of already so in marketing

terms we use something called automation

where certain tasks are executed once

something is reached or once something

is triggered so for example in email

marketing when somebody goes to your

funnel certain laws exist where if a

person enters our email diversity van

they receive email one if they open up

email one to receive email two if they

open up email – they receive email three

so what this refers to is I FTP if this

then that logic so that’s what smart

contract is in a nutshell is if this den

doubt logic so if if we created this

code online on the blockchain and the

law states that if a person puts in

money into this contract then that will

execute a next action that next action

will then send maybe a digital contract

to somebody’s email and that person will

get this contract let me sign off and

then that trigger will go back to the

smart contract code on the blockchain

then execute something else so if in a

nutshell it’s a domino series where you

need a pre-existing event to trigger the

next event the

example when it comes to real life is a

vending machine I put in a dollar that

is the first trigger that triggers the

option for me to type in a code I type

in you know b6 that that trigger of me

typing in b6 execute you know a bag of

chips falling from the vending machine

so that’s what a smart contract is in a

nutshell it’s if this then that logic

programmed onto the blockchain and run

by all the computers and knows on that

system which automatically then updates

the transparent ledger that everybody

can see okay I hope you understood that

if I got anything mistaken please

comment below so let’s kind of continue

beyond that because what’s the big deal

so what it’s a pretty written code on

the blockchain that can execute a bunch

of different actions such as keeping

money in it on an escrow or executing a

contract to buy something so I’m going

to give you examples of why this might

be really amazing when it comes to

real-life examples and let’s talk about

two examples that probably everybody has

gone through or three examples that

everybody has gone through in one form

or the other one number one is buying a

car number two is buying a house number

three is say renting a condo renting a

house number one you wanna buy a car how

does that work well either you go online

you find a car you go to the dealership

and you guys going to haggle for the

price you get a price you got to go to a

bank and the bank is going to draw the

bank’s going to track you maybe a

guaranteed check you take that guarantee

check back to the dealership they have

to clear that I check the check is

cleared you got to sign a bunch of

paperwork’s to ownership the title for

the car ownership and finally get the

car so the process takes a while maybe

takes a couple of days to execute now

imagine if you had that on a smart

contract where the actual car itself

let’s say a brand-new Tesla was uploaded

to the blockchain so the ownership of

the car or the details of the car how

much the car cost and asking offer for

the car is on the blockchain and then

you come around even online and for by

the way they do sell Tesla’s online so

that’s going to be something big in the

future where you can actually buy cars

online so you go online you see this

Tesla and you’re like wow this is

amazing all the details are there it’s

it’s on the blockchain so you know the

information is correct and they’re

offering let’s say $40,000 for the car

so the traditional way as I just mention

is going to the bank going through this

process signing paperwork going back and

forth and taking a while however what

you can do is since it’s on the

blockchain they have a smart contract in

place where you can actually execute or

order in real time so they’re offering

$40,000 what you’re going to do is you

can buy a den in there you can pay by

crypto but it’s going to be flawless you

won’t have to like you don’t need to

even have crypto you’re going to have a

come to a point where you’re going to

have your fee at bank account attached

with token that token represents a

crypto so it’s going to be done in real

time and then you can buy that car right

away the ownership the information

everything about it is executed on that

smart contract you now hold the

information or you now hold the

ownership of that car a digital identity

on the blockchain ledger now every

single node every single computer part

of that blockchain ecosystem

automatically updates the ledger so

everybody now knows on a network that

that car was just sold to you so

everything is updated so that’s one

really cool thing so imagine like the

whole car industry how that’s going to

be revolutionized so number two is say

buying a house or buying a condo the old

way is you know you go there you put a

bid you got to put a deposit down then

you get the ownership paper then you got

to go check it the ownership is legit

you better go a lawyer and pay the

lawyer to sign off to make sure there’s

no liens against the house and make sure

that this is the actual authentic

ownership paper of the house and you got

to go back and you’ve got to go banged

in terms we’ll get a mortgage so the

whole process is very long very

convoluted now imagine instead of – same

thing like the car where the house

originally was uploaded to the

blockchain with the ownership confirmed

making sure there’s no liens against the

house full transparency

once you accept it how much of the

mortgages left everything every single

process that we need to go through today

to buy a house is already on the

blockchain then I come around I want to

buy the house for a million dollars I

put my 5% deposit these are betoken or

crypto online automatically the smart

contract executes that opens up now the

information for me to see the whole

history of the house it double checks

everything I don’t need to go to a

lawyer I don’t need to know third party

verification is verified already on

there then I can actually make my

purchase in real time now what’s cool

about this if we’re thinking more out

there in the future

is imagine now 10 of us want to buy

piece of property so now we can actually

do like multi equity buys with in a

house on a smart contract that executes

everything towards us and this is it has

exponential effect that’s one of the

other amazing cool things our smart

contract is multi-purpose buying a Multi

signature bind where even if I want to

sell something I can sell one third of

something but for us to so the whole

piece of the pie or this property all

three of us who are legal owners have to

sign off of it automatically on it smart

contract and so finally number three is

a rank so whether you are a tenant or

landlord there’s always problems on both

ends doesn’t matter what party you’re

talking to now imagine if your landlord

you know you have a lot of and I’ve gone

to this process myself you have a lot of

issues with collecting money from some

people it’s just fact the reality by

first up sometimes as a tenant your

landlord is this guard which treats you

like easily dilemma or slum in the

place is horrible so there’s issues on

both end

imagine you are landlord and as opposed

to trying to collect say it check every

month or in cash every month or maybe

have it on visa etc imagine having your

your contract your actual monthly rental

contract on a smart contract where it

automatically takes a token or crypto

off of that tenants of yours into your

own digital wallet and what’s cool about

this is as a tenant that pays on time

with the smart contract especially on

the blockchain you can actually create

something called digital identity with

social credibility so the more that that

individual is trustworthy paying on time

being a good tenant their social credit

Rises and if their social credit is good

that is a lot of leverage that

individual can get better credit or or

get better loans that individual might

even get a reduced cost when it comes to

rent because you know he has never

faulted or she has never faulted on any

rent for the last two three years so

there’s a lot of possibilities when it

comes to these comes through the smart

contracts that way so to kind of

summarize in a nutshell a smart contract

is just an agreement between couple of

multi parties online that can be

automatically executed on a transparent

blockchain using weather tokens or

cryptocurrencies and you can actually

involve multi parties all at one time so

just imagine any type of

you’ve done in your life physically

offline and just picture that now

uploaded and implemented on the

blockchain so that’s it that’s pretty

much a smart contract in a nutshell and

like I said before I’m just trying to

condense the technicalities or the the

big high level of thinking’s into a

small concept over here I know I

probably butchered some ideas over here

about remember I’m trying to make it

simple if you did notice anything that

didn’t make sense to you leave a comment

below this video and like always guys if

you want me to make more videos leave a

comment on suggestions for the next

videos and have a great day