Blockchain Smart Contracts For Frictionless Work Process Between Parties

What is a blockchain smart contracts?

Primarily, a contract means an agreement between two or more parties on the establishment, adjustment, or termination of rights and obligations. Traditionally, a contract can exist in verbal, paper document forms. In light of the rise of computers and technology, a contract can exist in digital form as well.

How can a smart contract enable frictionless work processes between parties?

The purpose of a smart contract is to simplify the work process between parties while remaining and enhancing the efficiency of executing processes and optimizing cost.

The automatic mechanism:

  • Reduce the need for paperwork positions: With traditional contracts or even with rudimentary digital contracts, manual tasks (collect the documents, input data to the contract template, and decide the implementation of the contract) still ensue. A smart contract, instead, occurs entirely and automatically in a digital environment, cutting down or even eliminating the participant of roles that don’t create much value to enterprises.
  • Automation also allows a contract to perform in a vast number of transactions at the same time.
  • With an automatic mechanism, a smart contract makes daily business operations easier. For instance, notarization vanishes because data is already stored on a distributed database immutably — a unified set of data with multiple verified copies.

The elimination of intermediaries and a trusted third-party:

The role of intermediaries or a trusted third-party is to ensure the terms are compliant by competent parties. But the problems are these parties require a substantial cost to maintain low-value services. Moreover, the risk of data breaches when incompetent parties involved in the process is high.

Traceability:

Enterprises take a colossal effort and use multiple different channels to connect and track the phase of the execution process. With a smart contract, all information is automatically updated, stored, and reported in a unified distributed ledger, which contributes to a better management system.

Stop the misunderstanding of terms:

The language and terms used in a contract should be mandatory to be precise and not to be misleading. Smart contracts on blockchain use language logically to match the algorithm with less complicated terms, facilitating a thorough understanding of the rights and obligations and lowering the semantic conflict.

Reduce cost and enhance business operation:

More effective process, cutting off unnecessary components are keys to cut off cost and support to a new business operation model transformation.

Conclusion:

Blockchain for business, along with the smart contracts, is still at the early stage of blooming. There is plenty of work for enterprise blockchain platforms to do to make this technology more mature in terms of real businesses.

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Website: https://akachain.io

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