the Solution works on a controlled blockchain. Blockchain-the system will process direct debit transactions in which a payment triggers are not the sender and recipient of funds. The platform will allow you to track claims between the parties through a decentralized corporate network, this will facilitate the exchange of messages and make the process transparent.
in Addition to Argentina’s Central Bank system of testing financial institutions, clearing firms and leading commercial banks. The regulator and the developer are confident that the network of smart contracts may be the basis for an alternative clearing system.
In the world practice smart contracts are used not only in the financial market, including banking and insurance, but also in public administration, retail, health care, at the initial offering tokens (ICO) and so on.
According to Dune Analytics, the number of new smart contracts in Ethereum in March reached nearly 2 million – is at a record 75% more than in February. Growth occurs on the background of reducing the cost of placing the smart contract: now it should average about 11 $ 600. This is due to the scaling of technology and introduction of Ethereum 2.0 (was in April launched a test network of Ethereum 2.0 Topaz). It should be a decentralized blockchain-a platform that supports thousands of transactions per second, the processing of which is cheap and does not require huge energy costs.
What is a smart contract? About the operating principles, applications, strengths and weaknesses of smart contracts the Director General of the Association of FINTECH (AFL) Tatyana Zharkova.
the idea of a smart contract in the 90-ies suggested an American scientist in the field of computer science, cryptography and law of Nick Szabo. He described the smart contract as a digital representation of a set of obligations between the parties, including the minutes of the enforcement of these obligations.
Smart contracts used for conducting various transactions in the blockchain. It’s computer algorithms that automatically control and validate data entry and ensure the execution of obligations undertaken by the parties to the Treaty. In this case all the terms of the deal should be formalized and translated into the appropriate code. Automatic execution of smart contracts using technologies of distributed registers allows to reduce financial, administrative and time costs of participants in the conclusion and fulfillment of the terms of the transaction.
Often, the fulfillment of the conditions of a smart contract depends on information that is third-party information systems outside the system of distributed registries, which takes into account and kept themselves smart contracts. To retrieve data from external sources services are used, the mediators, “oracles”. For example, Oracle can provide stock data about the courses of securities and currencies for the execution logic of a smart contract on the transfer of assets between participants in the trusted network or to trace the fact and the date of delivery of the goods for further payment to the company or the imposition of sanctions for failure to fulfill obligations.
the Creation and subsequent execution of the smart contract, as a rule, takes place according to a certain scheme:
1) the coordination and consolidation of the terms of the transaction between the parties, the conclusion/create a smart contract;
2) smart connectivity-contract to internal systems (systems of banks or other financial organizations) and external systems oracles;
3) the expectation described in the contract and evaluation of smart contract their status at a particular point in time (as far as both parties fulfilled certain conditions);
4) samospalenie smart contract when executed by members of the established requirements.
there are several types of smart contracts, in terms of performance agreements:
· control of property relations – ownership and operations of digital assets (including crypto and tokens);
· financial services – trading, exchange, participation in auctions, trade Finance, etc. (large platforms allow the blockchain in banking transactions);
· credit commitments – execution of agreements on various forms of Bank credit products (e.g., platform Mastercam provides registration and storage of mortgage bonds in a decentralized Depository system);
· social services – the processes of insurance, procedures of voting and elections (e.g. elections using blockchain platform Polys in Saratov, e-elections to the Moscow city Duma and the Moscow system polls Active citizen);
· managing the delivery and storage of goods (for example, a network of “Dixie” using the blockchain has established communication with suppliers).
One of the most promising applications of smart contracts call automation providing banking services such as Finance, supply chain, mortgage lending and small business lending. Smart contracts will allow you to automate payments and to reduce the uncertainty and credit risks.
the Application of smart contracts gives users a number of advantages.
first is the transparency of contract: parties to the transaction can control its execution at all stages and to ensure that the counterparty has fulfilled its part of the agreement.
second, the smart contract provides for enforcement mechanisms of fulfillment of obligations such as fines and penalties.
Another benefit of smart contracts is their verifiability, which allows you to identify participants and pposledovatelnosti their actions, forming an audit trail. The value of smart contracts in the protection of their terms and conditions and data from third parties. the Privacy of “smart” contract insulates it from outside influences and the liability is limited to the parties to the transaction.
But despite all the advantages in working with smart contracts is their complexity, due to technical features and also the relative youth of the technology. Let’s consider the main.
the Automatic execution of the smart contract. On the one hand, this is an obvious advantage. But in the world of living people and objective factors affecting the business processes, the same item may get a minus sign. With smart contract it is impossible to “negotiate”. The automatic samovolnoy it does not take into account the arguments about the shortage of goods, flood, or life problems, and for violation of the terms of the deal will inevitably be followed by a penalty.
the Cautious attitude toward new technologies from the traditional, heavy on the rise of companies that used to work on the old-fashioned way. Such a contractor may refuse to make a deal in a new way or, as used to constant postponements, will disrupt the established smart contract regulations.
While in world legislative practice no formal status of a smart contract. In some cases this can hinder the settlement of disputes in violation of the terms of the transaction. In addition, leaves open the question of jurisdiction the decision of such questions. Among other things, smart contracts in cross-border relations – and there may be difficulty in the sphere of material and procedural law.
for Example, the European Central Bank in 2017 has released a report that identified several challenges associated with the use of smart contracts:
· the complexity of determining legal status for program code, which is a smart contract;
· the code may contain errors, eliminate which will be more difficult because of the relationship of the various elements within a distributed registry;
· execution of the smart contract is tied to external events, which can go incorrect or inaccurate information.
But all these issues are worked out and are gradually being solved, and how in the world practice and in Russia.
In our country the development of the technology of the distributed registry is actively involved in the Association of FINTECH (aft) jointly with the Bank of Russia and a key financial market participants. On the court the AFL was created Mastercan first certified FSB platform, which uses the Russian standard of cryptography and meets all requirements of information security.
On the platform Mastercan implemented three projects – “Digital��s of the Bank guarantee, “Digital credit”, “Accounting electronic mortgages,” are based on the system of smart contracts. It implies that transactions can be samulioniene, that is, a transaction (e.g. money transfer) can be carried out automatically when the conditions are met. Helping to eliminate fraud, but the deal-making process becomes much easier, faster and safer.
In General, the popularity of smart contracts and the ease of use grow, the it industry is working to improve the technology, more and more companies from different industries are adopting blockchain. Now the main ways of development of smart contracts can be called the standardization of cryptography and templates, create visualization tools for the formation of logic smart contracts from the finished blocks, as well as the development of legal and regulatory framework for work with smart contracts.