. Understanding Smart Contracts in Algorand

. In today’s world it is a daunting task to maintain task to main law and order, business transactions have to go through a lot of paper work yet this does not guarantee that either side will abide by the terms and conditions of the contracts. Blockchain technology creates a trustless system of storing information without the need for all the paper work. Better still smart contracts helps build sophisticated dApps(decentralized applications) for various financial uses, seeking to create an alternative to existing financial services. These use cases range from simple transactions (peer to peer payments) to much more complex and multiparty application such as loans, assets trading, insurance, exchanges, assets tokenization and more.

. A smart contract is a self executed contract with the terms and condition of the agreement programmed on a blockchain network. It is written into lines of code and this code controls execution of irreversible transaction which are transparent and traceable. Smart contracts have become so useful. and improved our everyday life. Some ways smart contracts can be used are:

• Insurance: Smart contracts helps in supporting of insurance policy and improves the process of processing claims.
• • Voting: Smart contracts have become a simple and cost effective solution to this problem. This is used to validate a voter’s identity and record each participant’s vote making voting process easier.
• • Property Ownership: Here, it is used to record the ownership of all types of property ranging from lands to houses which helps sellers to handle transactions by themselves.
• • Stocktaking: Supply is another area of business that benefit from smart contracts. Records of each product is taken which eliminates in-house theft and helps to track down any missing product.
• . Algorand, is an open source public block chain based on a pure proof of stake consensus protocol that supports the scalability and transaction finality has taken the next step to bring advanced smart contracts. Algorand Smart contracts are basic lines of code stored on a blockchain network and executed based on guidelines and conditions which enables developers build dApps. Being an essential tool used by blockchain developers smart contracts have adopted the blockchain technology which and becomes the driving force of the decentralized ecosystem.
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• . Advantages Of Algorand Blockchain
• . Algorand provides immediate transaction finality, new cases and applications which is delivered in speed and all known required to maintain, control and govern their operations. Algorand smart contracts are highly flexible and reliable in that they are executed on a tamper proof network providing complete transparency set to change blockchain and develop the world’s public, permissionless, scalable, secure, faster, decentralized, that are cost efficient and effective for financial organizations. Algorand provides both stateful and stateless contracts. This stateful contracts are the building blocks for distributed applications on the Algorand blockchain. It is combined with Algorand Layer 1 to implement application that take advantage of Algorand’s scalability, performance and quick transaction finality. Stateless smart contracts are used to replace signature authority for transactions. This transactions must be signed by either an account, multi signature account, with logic which Algorand designates as a Logic signature. Algorand smart contracts are built directly into Layer 1 which allows developers have an advantage of the fundamental attributes and significant benefits of the network and access to simplified tools. These benefits include:
• • Ability to build seamless complex applications
• • Scalable, fast and secure execution
• • Low cost to execute
• • Increased speed to market with comprehensive development resources
• • Flexibility
• • Frictionless application
• Algorand’s smart contracts are paving way for a new financial world in the following ways:
• • Trade Finance: Trade finance stands to benefit immensely from the introduction of smart contracts. The middleman is eliminated from a financial transaction reducing additional cost in hiring them as a validator. By so doing, the cost of transaction fee is reduced and the speed at which payment is made is faster.
• • Financial Data Recording: Integration and introduction of smart contracts by financial institutions records accurate data of individuals which ensures there is integrity and transparency. In this case, algorand smart contracts creates a link between legacy systems and block chains. Some of the other block chain smart contracts use cases include their use in issuing prescription, storing receipts and so on.
• • Trade Clearing and Settlement: A large amount of investment in form of capital is involved with approvals from both external and internal sources. The Algorand blockchain offers immediate processing of transaction ensuring that as long as all the conditions of a transaction are met, thousand of transactions can be processed every second.
• • KYC and Compliance(Digital Identity): Nowadays, the process involved in KYC are so expensive and time consuming. Smart contracts enable people to own and control their personal data as sensitive information is no longer needed to verify transactions because it is implemented on a trust less network like Algorand.
• • Risked Based Capital(RBC): In today’s world, markets require the reduction of asset holding risk by financial institutions in order to maintain proper risked based capital(RBC) level. The requirement for maintaining capital provisions is eliminated and smart contracts enables this settlement and eliminates the need for a third party. Revolutionary Application of Finances in Algorand’s. Smart Contracts
• Today, the exchange of money and assets are perplexedly moved using complex, oudated systems which are dull and requires cost in each intermediary. With high demand for things, individuals and institutions compete into he global economy for faster, scalable, easier and safer ways to complete transactions. New entrants that are FinTech companies like Neo and challenger Banks are launching a new strategy for customers changing how consumers and institutions bank, trade, finance and offer payment. Due to this, consumers are left with choices of high expectations for fast, efficient and reliable services. The fundamental industry is disrupted with new technologies mainly led by blockchain. With Algorand blockchain, a wide range of opportunities like transparency which customers demand is offered.
• . In conclusion, the technological advantages of smart contracts in Algorand is a place where revolution is taking place. Algorand enables developers to overcome legacy blockchain limitations and take advantage of the network without sacrificing the simplicity that their applications require. It will help to speed up transaction times, lower costs and even make processes much easier and stress free.
• More info at www.algorand.com