Encyclopedia Classification
Category: Blockchain Technology • Decentralized Computing • Digital Automation
Discipline: Smart Contract Development • Blockchain Programming • Protocol Security • dApp Infrastructure
Prerequisites
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Volume I, Article 8 — Blockchain
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Article 228 — Layer 1 Blockchain Analysis
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Article 230 — Crypto Bridges and Cross-Chain Infrastructure
Related Articles
Decentralized Applications • DeFi • Ethereum Virtual Machine • Smart Contract Security • Blockchain Programming
Definition
A smart contract is a self-executing computer program stored on a blockchain that automatically performs actions when predetermined conditions are met.
A smart contract:
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Contains programmed rules.
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Runs on blockchain infrastructure.
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Executes automatically.
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Does not require a traditional intermediary.
The central idea:
Smart contracts transform blockchain networks from systems that transfer value into systems that execute programmable agreements.
Beginner Explanation
Traditional agreements require trusted third parties.
Example:
Buying a house.
Traditional process:
Buyer.
↓
Bank.
↓
Title company.
↓
Government records.
↓
Seller.
Many organizations verify:
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Ownership.
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Payments.
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Contracts.
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Transfers.
A smart contract replaces parts of this process with code.
Example:
"If payment is received, transfer ownership."
The blockchain automatically executes the agreement.
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