What are the key smart contracts in defi?

People often ask , What is a smart contract ?   Then you must first understand what is “ contract ”.

Contracts in daily life （ Cooperation agreement ） That is, between the partners “ contract ”, Now we can hardly live without a contract , Go ahead and say , Work is a labor contract signed with the company , Buying a house is signing a house purchase contract with a real estate company , To buy insurance is to sign an insurance contract with an insurance company ; Say small , online shopping 、 Order take out 、 Take a taxi 、 Buying lottery tickets is to sign corresponding contracts with relevant service providers . so to speak , Where there are people, use contracts .

We even bet , It's also a contract , But if one side denies , Then it will be difficult to fulfill the contract . If there is a contract , Set the rules in advance , Once the relevant terms are triggered , The contract will be executed automatically , Without human intervention , Don't worry about someone denying . Is there such a contract ？ There are , This is the smart contract .

What is a smart contract

  Intelligent contract （Smart Contract） Last century 90 By Cryptologist Nick · Saab's idea , Due to the lack of a credible execution environment , Smart contracts have not been applied and developed , until The etheric fang Appearance , To make smart contracts “ resurrection ”.

What is a smart contract ？ In short, a smart contract is a contract that uses computer language instead of legal language to record terms and is automatically executed by a program . let me put it another way , Smart contracts are digital versions of traditional contracts , Running on the blockchain network , Automatically executed by the program .

vending machine 、ATM ATM , To some extent, it can be understood as a machine executing smart contracts , But this is not a real smart contract .

What are the characteristics of smart contracts ？

Compared with traditional contracts , Smart contracts have three characteristics ：1、 The content of the contract is open and transparent Smart contracts are deployed on the blockchain , The content of the contract is naturally open and transparent .

2、 The contents of the contract cannot be tampered with Again , Because it is deployed on the blockchain , The content of a smart contract cannot be modified .

3、 Permanent operation Smart contracts running on the blockchain , Also maintained by the network nodes on the blockchain , As long as the blockchain is in , Smart contracts can run forever . Species “ The chain is in the contract ” A sense of brotherhood .

Smart contract with three characteristics of blockchain , Compared with traditional contracts, it has the following advantages ：

1、 To trust .

Because the smart contract is based on blockchain , The content of the contract is open and transparent 、 And not tamper with . Code is law （Code is law）, Traders are based on trust in the code , Can be reassured in an environment of mistrust 、 Trade safely .

2、 economic 、 Efficient

Compared with the traditional contract, it is often because of the different understanding of the contract terms , Cause a dispute ; Smart contracts avoid disagreements through computational languages , There is little dispute , The cost of reaching a consensus is very low . On smart contracts , The arbitration result comes out , Effective immediately . So compared to traditional contracts , Smart contracts are economical 、 The advantage of efficiency .

3、 No need for Third Party Arbitration

Suppose Xiong DA and Xiong Er bet , Bet on whether it will rain tomorrow , Whoever loses needs to give it to the other party 100 element . If the loser denies , If you win, you won't get a reward . So , Go to a third-party arbitration institution , Inefficient and time-consuming . But if the bet is written on a smart contract , When the bet is reached , Respective 100 Yuan into the smart contract address , Smart contracts are based on the final results , Automatic execution , The winner takes all the rewards . so , Smart contracts do not require third-party Arbitration .

Is smart contract really smart ？

The above is all about the advantages of smart contracts , Is smart contract really smart and flawless ？ It's not , Smart contracts also have their drawbacks .

As mentioned above , The tamper proof properties of smart contracts , It's easy to build trust . But there is also a bad side , If there are loopholes in smart contracts , Hackers can exploit loopholes in smart contracts , Make a profit for yourself .

A simple example , A vending machine , The original price was 5 A soft drink , by mistake , It has been written. 5 dime , After the administrator found out , It can be corrected immediately . But if this vending machine invokes the smart contract on the blockchain , Then this error cannot be modified , Until the drinks are sold out .

On the other hand , The smart contract itself cannot be obtained （ perception ） External information , It involves the need for external information to adjudicate the contract , You need to write relevant information to it , It can make a decision . For example, Xiong DA and Xiong Er bet whether it will rain tomorrow , The smart contract itself doesn't know whether it rained the next day or not , It needs to be provided with information through other information sources , For example, the data of the Central Meteorological Observatory , Oh, after this information , Smart contracts make decisions .

From the two points above , Smart contracts are neither perfect nor smart .

Summary

in summary , About smart contracts , We know ：

Smart contract uses computer language instead of legal language to record terms 、 A contract executed automatically by a program . It deployed on the block , It also has the data openness and transparency of blockchain 、 No tampering 、 Characteristics of permanent operation .

Compared with traditional contracts , Smart contracts have to be trusted 、 Security 、 Efficient 、 Advantages of not requiring third-party Arbitration . But smart contracts are not perfect , And it's not intelligent, or its intelligence is very low .

It is mentioned in the article that the execution of smart contracts does not need the judgment of a third party , At the same time , When the execution condition involves external information , Smart contracts cannot be perceived , You need to input relevant information into the smart contract , To trigger the smart contract to enforce the ruling .