Hi! This is Chachababe again. New year, still the old me but hotter. Don't get bored with me. I know yall miss me, just admit it. Hope yall good as mine though. This time I'm gonna talk about smart contracts. I know I'm a newborn baby on this thing but let me share some things I've learned from the internet. I welcome you guys to correct me if I get things wrong.
The term smart contracts was first used by Nick Szabo in 1997, long before Bitcoin was created. Smart contracts are actually just like contracts in the real world. What makes it different is, they're completely digital. We now live in modern world baby. Smart contract is actually a tiny computer program that is stored inside of a blockchain. No middle man. Remember? Decentralized. Smart contracts work almost the same as blockchain. I mean.. it is running on the blockchain duhh! Please lighten me up if I get things wrong.
Ok, since I'm the kindest and nicest babe on the island, chachababe will give you the simplest example so it is easier for you to understand. Where do you usually get a loan from? Yes I heard you. A bank. But it will all be complicated. Before they give you some loans, they're gonna check all of your datas, such as your income, make sure if you don't have any debts or you already pay it all back, basically all that stuff they needed to check. Worse part, you have to pay them more when it's payback time. That is what banks do if you ask them for loans.
How if we do it through smart contracts? It will do you differently, baby. This is the smartest way especially for yall who live abroad. You don't need to go back to who you are from to give all the papers that the bank might need for a fken loan. Be grateful we now have internet and live in a digital world. Thanks to whoever makes this world way easier. This is what the future is.
Ok ok I heard you. Here is the example, say you need some loans to build a business project. You can use smart contracts for it. Pretty same like bank in real world. It needs a deposit to make sure it secure and fair. 'Hmm what kind of things i can use for a deposit?'. Say you have an NFT that could be worthy in years, you surely can use it as a deposit. The NFT will be locked and stored in the smart contract. As soon as it is stored, you will get the money. It will take like only in secs, boom! But if you do it through a bank, it will take forever. Even worse they will still be a pussy and telling you that you can't get the loan because of something. What an ass.
We always have to think about the bad parts. Because sometimes life is a bitch. Say you can't pay back the loan. You don't have enough money because the business ended up flop. Your NFT that you use as a deposit will not belong to you anymore. Fair play. Rules are rules. But in other ways, you pay back the money, your project business is going good, you get your NFT back. It's a happy ending.
'What other benefits chachababe?'. Smart contracts are immutable and distributed. Being immutable means that, once smart contract is created, it cant never be changed again. No one can fool and stab behind your back and tamper with the code of your contract. It's the 'secure' for me.
What about distributed? It means the output of your contract is validated by everyone on the network. Not a single person can force the contract to release the funds because other people on the network will spot this attempt and mark it as invalid. It' a fair fair game.
Now, there are a bunch of blockchains that support smart contracts, but the biggest and well known one is Ethereum. Vitalik Butherin made Ethereum specifically created and designed to support smart contracts. He a smartass. I mean from what I know Bitcoin also supports smart contracts although it's more limited compared to Ethereum. These digital contracts can be directly between a user and a large company or involve a large company acting as a trusted intermediary between two users. Not only between individuals.
Ok booboos, babies, aliens and human friends, that was some knowledge I know about smart contracts that I've learned from the internet so far. I'm so into this technique. Because bitch everything's gonna be fair. And that's what we expect in this world unless you are a bad guy.