The revolution of smart contracts

The revolution of smart contracts

Technological advances are having a drastic effect on the economic and legal sectors; they are resulting in what today may seem like a utopia but in the near future will become the standard form of establishing agreements. Smart contracts are already in use and could resolve many of the non-compliance issues in the contracts we have used so far.

If a client has a smart contract lease on a car and they fail to make a payment, it would be blocked automatically at the order of a previously established clause which is also assigned a conditional code, this code contains the payment possibilities established by the parties. 

Blockchain plays a really important role here, since this technology cannot be altered whatever has been established in a smart contract must be complied with at all times. Moreover, all the details of a node-executed transaction will be registered and it will not be possible to modify them.

However, this method is so novel that there are still some doubts that must be resolved, especially in terms of effectiveness and jurisprudence that should be applied if, for example, all the participants in an online contract come from different countries.

Moreover, contracts must be drafted by a lawyer and a computer scientist that will be able to translate the code. This makes the process more difficult for small enterprises which cannot allow themselves for such an investment.  

 

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