SMART CONTRACTS - THE FUTURE
The major purpose of Ethereum is to be a platform on which smart contracts can run. Now the question is, what are smart contracts? Let’s explain with a basic example of what Ethereum might be able to do in future.
Ethereum aims to make everyday life more efficient and cost effective by automating everyday processes and removing middlemen from the systems we use.
This could be to the financial system, the legal system, computer systems or more.
To substantiate further, let’s assume Dale has the following documents stored on the Ethereum blockchain: his land documents, his identity, and the title deed for his house. Dale had put up his land for sale and he's going to sell to his best friend Shawn. The transaction took place and also uploaded to the blockchain.
The processes that must occur to transfer Dale's land are admin intensive because there are several parties involved that are often slow and opaque. This may include legal professionals, the government, tax authorities and the property registrar.
However, because all these documents are stored on the Ethereum blockchain, something fantastic and interesting is possible. Once the payment documents is officially issued and uploaded to the blockchain, ownership to the land can be transferred to Shawn automatically by the Ethereum network.
Therefore, Shawn becomes a land owner without having to contact a legal professional.
You might conclude this is pretty overwhelming and scary but the amount of time and resources saved by not having to wait for legal professionals and the property registrar to come into contact with each other and prepare and execute this transaction is immense.
Do you think smart contracts will make life easy?
To read more about the difference between Ethereum and Bitcoin, read our previous blogs and Share to educate others.