Smart contracts Vs Traditional contracts

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How does a smart contract differ from traditional contracts?

First things first. A traditional contract is a set of rules that defines how a relationship or business functions between two or more parties. The rules written in the contract are solid proof that certain things be the way they are meant to be. Any disputes will be solved with the guidelines in the contract document.

This is the case in traditional contracts. The same applies to smart contracts on the blockchain. The significant difference between the traditional contracts and smart contracts is that the latter is virtual, autonomous, and non-editable.

Smart contracts a deeper dive

Smart contracts are codes written on the blockchain that enforce, negotiate, or even perform certain actions when the given rules are met. Such contracts eliminate the need for third-party intermediaries.

Once the codes are written, they undergo a rigorous testing process which is known as the smart contract auditing. This is crucial for every blockchain smart contract as any minor error could cause a huge downfall.

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