They won`t completely replace lawyers, but blockchain-based smart contracts are evolving into wider use as increasingly sophisticated businesses embrace blockchain for everything from supply chain improvement to document archiving, data storage, and cryptocurrency-based financial transaction management. “If someone wants to transfer new technology, it takes a while,” he explains, “because there are always new concerns that someone will have that we haven`t thought of yet. Another important aspect to consider is whether smart legal contracts are legally binding and therefore enforceable, although under normal circumstances it does not seem necessary to execute such a contract (since it should be executed automatically). The global shift between countries towards the implementation of e-government systems has become more compelling with the entry of smart contracts into the utility sector. By providing services based on blockchain technology, governments can securely share information and resources with individuals, groups, and other governments through a distributed, decentralized public ledger. A smart contract is a digital contract that automatically executes the terms of an agreement itself. Simply put, it is computer code that contains the terms of a contract. It is stored in decentralized and distributed public blockchain networks that entrepreneurs can access from anywhere, anytime. With these designs, this type of purely digital contract running on blockchain nodes cannot be changed. Smart contracts also offer revolutionary changes in the way businesses manage their payroll and other critical business systems. As more companies work with a distributed remote workforce, managing employee compensation has become more complex.
In addition, different parties, completely unknown to each other, can participate in a highly secure business through the use of smart contracts. This robust system ensures that no form of fraud takes place and speeds up that a fixed transfer of funds takes place as planned. These are the main power exchanges that take place in decentralized networks such as Ethereum and Bitcoin. In addition to ensuring the security of government and citizen data, the use of smart contracts eliminates the single point of failure inherent in most public service models (Moné, 2019). It can also help regain or improve public confidence in the public service and enable public servants and administrators to achieve greater transparency and accountability. Besides the fact that smart contracts exist on their own, they can also be executed with other smart contracts without limiting the number of integration systems. However, this includes the need to make each system dependent on the other for each smart contract to work. For example, a successfully completed smart contract can initiate another smart contract to implement, and so on. For smart contracts to work and exist properly, they need to work in the following areas: However, it will take time, with ongoing efforts, including consultations with government authorities and regulators, to raise potential concerns about automating contract compliance. For example, what is the tolerance for compliance with the amount of water in a saltwater landfill from an oil and gas production well when volume measurement is used in the truck versus the sensor outlet at the site? Also, what kind of rounding will the smart contract respond to? Rounded, rounded, intermittent, bank rounding? These are the types of questions that need to be asked and developed before translation for the codification of smart contracts. Smart contracts are indeed becoming data specifications.
It should be noted that while there are smart contracts that are also tokens in themselves, such as ERC-721 and ERC-20, not all small contracts are tokens. Blockchain technology makes the idea of smart contracts appetizing for many tech enthusiasts. Cryptologist Nick Szabo was the first to propose a computer protocol that would allow e-commerce between foreigners and eventually replace legal paperwork. Today, a smart contract refers to a contract that is executed without the involvement of third parties and is written like a computer program instead of using a printed document with legal language. These problems will persist unless something drastic is done. To improve the situation and allow doctors to focus more on better care, smart contracts are becoming persuasive. Here are some areas of healthcare where smart contracts are currently used or considered: This classification means, among other things, that in most cases it is still necessary to define the terms of a smart contract, in whole or in part, in natural language. IIoT data provides source information to inform the execution of a smart contract. While the reliability and integrity of IIoT data is an order of magnitude greater than that of data captured by humans, there will always be problems and technological failures that will lead to gaps or errors in the data.
Contrary to what some might think, smart contracts will not replace lawyers. A handful of lawyers might initially oppose the new technology, hoping to continue as they have been doing for decades. However, for most lawyers, smart contracts have a lot to offer. Law firms are more likely to embrace technology and take advantage of all it has to offer. For example, the Electronic Signature Registration Act (Electronic Signature Act) and the Uniform Electronic Transactions Act (UETA) have recognized to some extent the applicability and validity of digital contracts (Levi & Lipton, 2018). These laws contain provisions on electronic agents, the functions and results of which can be legally attributed to contracting parties (Carey & Sayer, 2019). In other words, treaties will no longer be able to accommodate uncertainties. For example, the place and time must be explicit. If a company traditionally collects data at the close of business at local time, but this is not communicated to the counterparty, and the counterparty measures the data at the beginning of a business day in Coordinated Universal Time (UTC), confusion arises. The participants must agree on “specific data”, which in this case includes the exact time zone to be used with the specific time and what this means for the terms of the contract and performance. Legal departments drafting contracts must consider these details in advance.
A smart contract alone cannot obtain information about a “real” event by its own design. It cannot send HTTP requests (on the Ethereum network). This happens because when a smart contract relies on external information, it opens it to a point of failure. Smart contracts have largely contributed to restoring blockchain`s technological dominance on the global stage.