Smart contracts might honestly have unlimited potential…
My conversation with Andrew Levine the CEO of the Koinos Group last week about the Koinos Network opened up a whole heap of questions (link). There is so much to learn in this space and so we wanted to try and explain some of the myriad of concepts at their base level.
Here is the conversation I had with Andrew today about Smart Contracts on Cinnamon Video…
I’ve never tried this before… but it’s possibly possible that you could play it directly from pressing play on this tweet:
If that doesn’t work… here is the YouTube version…
It’s honestly really helpful to talk these concepts through, and even though I had some understanding of smart contracts, there are a lot of elements I really wasn’t sure of.
How smart contracts work…
Smart contracts hold incredible power for business. To be honest, it’s very likely that no one on the planet really understands the full potential of smart contracts, which is completely fine and extremely exciting.
At a basic level, a smart contract is code that will ultimate transfer value from one account to another, likely with some steps along the way.
Ignoring fees for a second, you wouldn’t want to buy a pack of gum with Ethereum directly, because you might be waiting at the register for 15 minutes if the network is congested… a smart contract could work instead because the transaction could happen much later because both parties agree to the contract.
Alternatively a smart contract could be super complicated, with lots of clauses. The code would run through the clauses systematically without requiring a 3rd party to mediate.
While smart contracts are incredible technology that could potentially save businesses millions, they aren’t free. Processing power isn’t free, someone has to pay for it, and on the Ethereum blockchain, that processing power is paid for with gas fees. The gas fees pay the miners whose servers the contracts run on.
The Koinos Network is working towards making smart contracts a lot more efficient… but how it intends to do that is a topic for another day.
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