Simply Explained – Savjee

What are smart contracts? How do they relate to blockchains and cryptocurrencies?

Smart contracts are simple applications that run on a public blockchain such as Ethereum, EOS or NEO. Smart contract platforms utilize their own cryptocurrency as the “gas” required to pay for running the code, which protects the network from spam attacks that could potentially slow the network to a grinding halt. The most widely used smart contract platform is currently Ethereum, however EOS is making great strides recently and is one to watch.

Smart contracts allow you to lock up your funds or data and release them only when certain conditions are met. By utilizing this technique we can implement a wide variety of banking and financial products without the need of a central authority. Things like automatic payments, decentralized cryptocurrency exchanges, automated estate wills and investment products such as decentralized hedge funds or crowdvesting can all be handled by smart contracts.

In the above video, Savjee simply explains the concept of Smart Contracts.

 

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