What is a Smart Contract?

What is a Smart Contract?






What is a Smart Contract?

A Smart Contract is simply a self-executing programme stored on the blockchain which controls, documents or executes actions or events taking place between a buyer and seller or two different entities.


How does it work?

Let’s say a user goes onto a DEX built on Ethereum and the user wants to swap their $ETH for $MATIC tokens. The user will swap and interact with the Smart Contract built on the protocol.

Once the transaction has taken place, it is written and stored in the blockchain forever. You can always go back and see the transaction, similar to a receipt but it can never get lost…

The idea of the Smart Contract was invented in 1994 by a genius called, Nick Szabo who imagined a marketplace on the internet that could facilitate transactions in a secure and automatic manner, using the powers of cryptography!


The Smart Contract contains various codes and agreements which span across the blockchain and allows any user to facilitate transactions in a decentralised manner, without any centralised authorities.

Smart Contracts and blockchain technology alleviate us from the worst industry in the world, the banks who have complete control over our assets and dictate how we spend/use our money.

Since the release of the Smart Contract programme, many supporting coding languages have come to fruition. Blockchain developers use different coding languages depending on their preferences or network. E.g. Solidity + Ethereum, Rust + Solana.




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