DeFi explained: Smart contracts

What is a smart contract? How does it work? And what are they good for?

What are smart contracts?

A smart contract is an agreement between two or more parties in the form of computer code. The contracts are stored on the blockchain and cannot be changed.

Transactions that take place in a smart contract are processed by the blockchain, which means they can be sent automatically without the intervention of a third party.

When you enter into an agreement with a smart contract, no confidential advisor is required. The transactions only take place if the conditions in the agreement are met.

What can smart contracts do?

Smart contracts help you exchange money, stock or anything else of value transparently, all while avoiding the services of an intermediary and the possibility of conflict. Smart contracts provide you:

• Speed ​ — Automated contracts can save you hours on manual paperwork.
• Accuracy — Because it is scripted, it prevents the risk of human processing error.
• Security — Smart contracts are secured with similar cryptography that encrypts websites. In short, it keeps your documents safe.
• Autonomy — You are the one who makes the…