9 misconceptions around blockchain smart contracts __ Blockchain

Smart contracts are a key underpinning of blockchain technology, but they are still misunderstood in many ways.

The HTML markup language allows information to be published and connected through a Web page, but in the complete deployment of the blockchain it is no less revolutionary than the invention of the HTML markup Language. Smart contracts can use cutting-edge blockchain to design our world, and may replace many features that need to be executed by expensive or slow-processing intermediaries.

Historically, this concept was first proposed by Nick Szabo in 1994. The smart contract experienced a period of inactivity and no care at the time, because there was no platform for them to run until the 2009 when blockchain technology came into existence. Now, smart contracts have entered their era, especially Ethereum's design of blockchain fundamentals through smart contracts, and further make smart contracts more popular.

Just like any new buzzword, the more popular it is, the wider the spread. And more and more people use it, it is easy to misuse and abuse. For different people this will mean a lot of different situations.

Here are 9 misconceptions about smart contracts, and I will try to expose and explain these misconceptions:

1. The smart contract is the same as the contract agreement
Not so. If we stick to Nick Szabo's original intent, smart contracts can make the cost of default expensive, because they control the real world's precious possessions by "digital means."

Therefore, the smart contract can achieve the specific requirements of the function, you can also show some conditions are satisfied or not satisfied with the evidence.

These features will be strictly enforced. For example, if a car is not paid for, the vehicle will automatically lock until payment is received to unlock it.

2. Smart contracts are like Ricardian contracts
Not so. Ricardian contract is a kind of semantic expression promoted by Ian Grigg, which can track the responsibility of both sides of actual agreement.

These can also be implemented on the blockchain, and there are no smart contracts. In general, multi-signature is one of the execution parts of the Ricardian contract.

3. Smart contracts have legal effect
Smart contracts are not laws, but they can also represent some legal agreements. The legitimacy surrounding the smart contract is still a work in progress.

However, the results of a smart contract can be used as an audit trail to prove compliance with legal provisions.

4. Smart contracts include artificial intelligence
Smart contracts are not really smart in their own right.

Smart contracts are real software code that runs on blockchain, and they are triggered by some external data to modify some other data.

So, they are closer to an event-driven structure than AI.

5. Smart contracts are blockchain applications
Smart contracts are often part of a blockchain-distributed application. There can be several kinds of contracts in a particular application.

For example, if a smart contract satisfies a certain condition, it will allow the program to update the database.

6. Smart contracts are easy to write
In a way. Writing a simple contract is pretty easy, especially if you use a specific smart contract language (such as Ethereum's solidity), which allows you to write complex processes in a few lines of code.

But implementing more advanced smart contracts requires the use of "oracles".

Oracles is a source of data that sends executable information to a smart contract.

7. Smart contracts are only available to developers
Right now, but we will soon see more humane entry points that may allow all business users to be configured through a graphical user interface, or through the input of a text language.

Ethereum's Mist Browser is a step in that direction.

8. Smart contracts are unsafe
This is not true. Even with Ethereum running, smart contracts run like full Turing programs, which means they don't have the risk of infinite loops at the end of the run.

9. Limited application of smart contracts
Not so. Just like HTML, the application's limitations are determined by the program writer. Smart contracts are an ideal choice for interacting with real-world assets, intellectual property, the Internet of things, and financial services tools.

They are almost suitable for anything that changes state over time and may generate added value.

These issues and themes will be discussed in the forthcoming Consensus 2016 symposium.

For more information, please click on the Shanzhai Development network: www.shanzhaibikaifa.com