Basics of Smart Contracts

Smart contracts are self-executing contracts with the terms of the agreement directly written into code. They run on blockchain technology, ensuring decentralization, transparency, and immutability. Essentially, smart contracts automate the execution of agreements, allowing for transactions and agreements to be carried out among disparate, anonymous parties without the need for a central authority, legal system, or external enforcement mechanism. They are pivotal in various blockchain applications, from simple transfers of assets to complex decentralized applications, offering a high level of security, efficiency, and cost-effectiveness.