What is The Future Preparing for Blockchain’s Smart Contract Technology?
David Petersson, a contributor at Forbes, wrote an article about Bitcoin, cryptocurrencies and smart contracts. He discussed the future of smart contracts and how blockchain technology evolved during the last years.
He starts by explaining that Bitcoin was created to replace banks and intermediaries using blockchain technology. At the same time, it was possible to replace lawyers and other contracts related to financial transactions. The author says that this is known as ‘programmable money’ and helped take decentralization to the next level.
Petersson makes a brief explanation on how Smart Contracts were created and how they gained popularity when they were introduced with Ethereum. Ethereum is currently one of the most popular blockchain networks in the market after Bitcoin and it uses a programming language known as Solidity.
Although Bitcoin also offers smart contracts, it is also necessary to know opcode programming to use it, making these smart contracts in Bitcoin very limited. There are some solutions in the market that allow Bitcoin to support smart contracts, for example, Rootstock.
The author Petersson continues his article by saying that smart contracts are open-source, self-executing code that run if there is certain condition met. Since the Ethereum platform allows users to simply create their own tokens, it has been used by many companies and developers in the cryptocurrency and blockchain world.
However, there is also a problem with these smart contracts, according to Petersson. He says that users do not only have to learn English, but they also need to study the code and understand this specific programming language. And this is an issue. There are just a few users that are able to do it.
He keeps ok writing that there have been several attacks on different blockchain networks and platforms. Smart contracts are far from being perfect since humans make mistakes. Some of these codes are published and bug hunters and hackers take advantage of these issues. For example, one of the most known hacks is related to DAO. In this case, the attacker was able to steal $60 million dollars.
Another important attack was experienced by parity. 150,000 ETH were stolen. At the same time, a user ‘accidentally’ triggered a bug in the smart contract that caused over 513,000 ETH to be frozen.
Other different platforms have also been hacked. showing that there are still some challenges faced by programmers and blockchain networks. And recovering the funds is somehow difficult since a consensus on the matter is required.
The author says that there are different fields that can be disrupted using blockchain technology and smart contracts. He makes reference to voting, management and supply chains, among other industries. It is possible to have different parties participating and cooperating in a specific network without being able to manipulate the system in their favour.
As mentioned before, there are some projects that are working in order to make smart contracts more seucre and accessible to everyone. Etherparty, for example, is working in order to solve common challenges that users are currently facing. The company has focused on two different products: Rocket (specifically designed for ICOs) and Hero (for charities).
According to Petersson, these products help ICOs create tokens, define addresses and breakdown sales and discounts during different milestones.
As a conclusion, he says that Smart Contracts are still behind ‘legal’ counterparts since they cannot be inclusive. However, they are working properly and provide solutions to the issues they are applied to. Clearly, they will not be able to replace lawyers, but they will clearly reduce the load on them.