I just came here after watching a 30-minute video. Needless to say, I got more out of your 4 minute video than the other which I watched several times and STILL came away with ???? "If you can't explain it simply, you don't understand it well enough." - Albert Einstein.
Finally a very clearly spoken and easy to understand video on this subject. I've watched three other videos on this thinking "how does this matter it seems very normal and not impressive" When i watched 2 minutes of your video I thought "HOLY SHIT THIS IS BIG!"
Thanks for the overview Simply Explained. I love how easily you were able to simplify the concept for someone who had no idea about smart contracts and their value proposition. Your effort is greatly appreciated.
Smart contracts are awesome. Ethereum, NEO and now Cardano - I'm loving the competition and innovation in this field! Smaller companies like PolicyPal Network and Propy are also doing a great job in bringing in smart contracts to increase efficiency and lower cost in their respective industry (insurance & real estate). Can't wait for more innovation in this area :)
And Elrond that launched Smart Contracts before Cardano and let the possibility to write them in any language that can be compiled to WASM (easy for Rust, C/C++ devs, but also possible for other programming languages).
Cardano is finally launching smart contracts this September, but don't forget that Flare will also be using them, and will add smart contract capability on the XRP ledger too. interesting times ahead.
I'm new to investing, and l've lost a good sum trying out strategies I found in online tutorials. I would sincerely appreciate any recommendations you have.
The first step to successful investment is figuring your goals and risk tolerance either on your own or with the help of a financial professional but it's very advisable you make use of professional
As a person who is in the process of writing PhD about smart contracts, I would love to thank you! That is a great video for explaining people what are smart contracts
After few hours of searching and watching videos, this was the first I've really get it right and easy to digest from A to Z. Still need to learn,but it's a good start. Thank you !
This is a great video - Thank you. Very interested to see how this progresses and all of the use cases that will emerge, particularly in security of health records
Great video and very well explained too!! One thing that I was a little confused by though is, how doesn't someone make sure that the actual smart contract that someone creates is trustworthy? Would a user need to go in and read the 'terms' (aka code) of the contract to be fully sure what the contract is doing?
Also interested in what mechanisms there are to verify whether the smart contract has been broken or upheld from inputs in real life, like if I fund something on kickstarter ensuring that either you get the product or you get refunded.
@@hsc587 Imagine this future scenario, its 2050, You enter a list of shopping items you need for the next week into Your robot, this information gets stored on a blockchain through a smart contract, so the robot goes through the city during the day visiting various vendors collecting the items and paying for them with your money/crypto. The vendors see the smart contract existing on the decentralized blockchain, so they hand out the merchandise and receive an immediate payment, so the contract gets safely and transparently executed.
So, this being said, why would you replace a third party with a smart contract? My answer is that having a smart contract in place, you will be charged a small fee when a transaction is made(when the smart contract gets executed). As far as i know, this is the smart contract business model the companies are using right now. So, replacing a third party with a smart contract is a very effective way to lower your business costs. (First big advantage) But, from my point of view, there is another advantage of having a smart contract in place. As this video explains, the smart contracts are blockchain based, and there is very slightly chance for this to be corrupted/hacked. What is really important here is that behind a smart contract there is CODE written. This means that when you replace a paper contract with a smart contract, you become digital. You actually replace words...with code. And the real advantage here is that the code is not doubtful...it will always execute the same way. (Second big advantage) Great work with the video!
Whoa, more I learn building blocks of internet during 90s, more amazing. Majority of society were raving about first online games ,getting any ISP, learning to use modem commands, when these people were researching 2000s, 2010s internet necessities in universities.
Dear Savjee. Your videos are very informative, enlightening and most importantly very easy to understand. Even a lay man can understand the technology if teacher can be like you. Thank you very much for the videos. Please do some videos on Decred, EOS, NEO, GAS, Power Ledger. And please do videos on ICOs that are introducing new Technologies. if we understand the technology at ICO level, it is easy for us to decide on worth of it to invest.
Every coin supports smart contracts, not only ethereum. Bitcoin script can be written on the Bitcoin blockchain so all coins that come from Bitcoin have smart contracts. In fact you could go even further and say, that every Bitcoin transaction is a smart contract itself.
Hello, great video, easy to understand. However, I always wondered how can smart contracts could replace things like Airbnb and Uber in the case of a complaint. In those cases, the third party can be the judge. How those situations are handled in smart contracts ? Would love to understand this to fully trust the concept of smart contracts. Cheers.
When you say that other people on the blockchain can see if a bad actor is trying to steal the money, what exactly do you mean? Are people actually watching the contract and policing it? Or is it computers? Or what exactly?
Great video! It is clear to me how the smart contract is fulfilled in a crowdfunding case as the only requirement is to reach a certain value. However, I can't understand how a smart contract would be fulfilled for the other examples, like insurance, which you mentioned. How is the validation that someone would need to retrieve the stored money on an insurance contract?
Yeah that example isn't the best one because people have a certain idea about how insurance companies work. But if you change that view, you can imagine smart contracts being actually useful. Let's assume that there is a company offering a natural disaster insurance. And let's also assume that the government publishes data about these natural disasters on a blockchain somewhere. Then you can make a contract that accepts a monthly fee from you and automatically pays out a fixed amount of money if a real natural disaster happened (and the government added it). A bit difficult and not all types of insurances are fit to be handled through a smart contract. A better example: insurance for losing your phone. The smart contract could be triggered if you put your phone into "lost mode" or if you file a claim with the police. Granted, these applications are not for tomorrow and will take some time. But it's definitely possible!
How are u going to change that view and what exactly should be the new view? Someone behind his or her computer making choices, without facechecking reallife? How do we know, this person is not forced into making this choice?
I get your point, but i'm still thinking: who decides you made your own decision, there is no central point who can defend you and back you up, it's only people with mining machines and are in the blockchain, who don't know the situation, cannot judge what happened, no witnesses at all, only data. Is that enough to transfer buildings/testimonia/ insurance money? I don't see it happening before me, but maybe i'm not seeing this right? And still again: you only see the data, is that enough? Maybe the data is correct but in real life the things happen the other way around. A machine can't check reality.
I think smartcontracts, the way it is explained here is only really good for true/false scenarioes. (yes / no scenarioes). In many of the examples there is more complex matters and shades of gray. I agree with you that these case still require 3rd party / human judgement. I am also of the oppinion that a blockchain of people sitting behind a computer will in no way be able to judge what actually happened in more complex examples. I.e I had a leak in my house, I claim to my insurance etc. Insurance company says I have not done my roof right or maintained it well enough to qualify. We have a disagreement. How will a blockchain judge who is right?? This is where qualified 3rd party surveyors come in, but it still becommes a matter of a human being, and his bias what decision is reached.
The problem is how can the Smart contract knows if the condition is really satisfied or not? Taking insurance as an example, how do we know if the car was really crashed or not? Shouldn’t there still be a reliable third party source of information?
Basically you would need a third party like the car mechanic who confirms, that the car is really damaged. He also signs the report with his key. If you and the insurance company trust the mechanic the problem is fixed. Obviously in this case we dont operate in a public blockchain but in a permissioned one, where e.g. the mechanic can only approve the state of the car but can't see for example how much money the user gets from the company. Hope this helps
Hey several questions 1) Isn't Kickstarter the smart contract, all of the activities are automated and not done manually and something similar happens in smart contracts - what's the difference?
I understand it this way: The difference is that Kickstarter is one entity and they could just withhold your funds at any time. It's all about trust and if you trust Kickstarter, then no problem. But if you don't want to have to trust a single entity, use a smart contract.
"stored on the blockchain" what exactly does that mean? how is the smart contract work? are the bytes of the contract being distributed and processed individually?
How complex are smart contracts expected to be, and how do we know they'll work? For example, I suppose a contract can stipulate the following simple transaction: 1) Purchaser selects article 2) Selected article is drawn from inventory by seller 3) Article is shipped by an approved carrier 4) Carrier obtains signature from purchaser or their agent (perhaps permissible agents must be specified) 5) Certain period of time elapses after signature to provide for return of defective or non-conforming article 6) Funds are irrevocably transferred For your average John Doe, that will take a lot of computer code that isn't familiar to everyone (and Solidity isn't going to be here for much longer!), but let's continue. John Doe doesn't want to hire a programmer, so he selects a proper-looking ready-made contract that has earned high approval from a certified board (certified by whom?, pray tell) designated to read the open-source code and certify that it does what it seems to be intended to do. Of course, only certain board-certified open-source contracts will be offered by the seller. We must hope that no unseen vulnerability has escaped the certified board (SQL insertion, overflow, the usual suspects). If that happens, who's responsible? It looks like we just added a whole layer of professional people to what used to be a simple dispute call to AmEx or Visa, but let's continue. Now, what if there's a complex contract that's unique to parties who are doing a large and costly project (Multiple sources, QC inspection, time restrictions, all-or-nothing execution, etc)? First, as always, a legal team has to be engaged to write the contract in a way that suits the principal players. In the absence of a perfunctory, one-size-fits-all contract like the sample above, a programming team has to be engaged to turn the legalese into computerese. (Few lawyers speak English with boolen clarity, let alone Javascript, or C#, -- or Haskell!) Since there won't be a whole lot of repetition and board-certified reading of open-source contracts, an insurance company with its own code readers will have to be engaged to provide a bond that guarantees the correct behavior of the smart contract. Now we've added an insurance company to the smart contract writing company. More overhead. I suppose that, after 40 or 50 years, certain contract templates will be recognized by the business community, but before then, there will be lots of unforseen circumstances and ensuing hostilities. Of course, even today, a contract is only a basic directive for parties who trust one another. If someone's out to screw you, they'll put in some clause that your team doesn't catch and you'll be exposed to taking a loss. The MAIN reason for a contract is to define rights and obligations, not to prevent dirty dealings. If you the person you're dealing with isn't worthy of trust, no contract will help. That's a rule. So, with all of that said, I feel that we're running headlong into a situation where people might be lulled into thinking things are "trustless". I'm all for the level of trustlessness needed simply to transfer funds safely (like, to your brother.) But there CAN'T be a trustless environment in ACTUAL BUSINESS. Any comments on these observations? Maybe the only contract necessary (beyond the basic one I submitted) is the one for escrow -- and leave everything else just the way it has always been. The lawyers are headache enough! In that case, the world will only need 1/2 dozen small, generally recognized smart contracts, right? So, my question restated is: Just what kinds of contracts are being proposed? Everyday simple things, or matters of unique complexity? (Sorry if I rambled a bit, but I think you get the gist of what I'm saying.)
Interesting question. First of all, as you said smart contracts should not be super complicated. The risks of having a bug in there is just too big. See the incident with the DAO that led to an Ethereum hard fork for instance. If something happens with a smart contract, it's hard to point fingers. Just like with a real contract. If a certain clause is too vague, who's fault is that? The lawyer who wrote it? The people who reviewed it? At this point however the damage is already done so might as well try to recover instead of pointing fingers. I follow your reasoning concerning the overhead. Creating a smart contract with the same amount of details as regular contracts will be very time consuming. But after that, the contract can operate autonomously and always give a binary output. There won't be any gray zones. If you look at insurances for instance, it would mean that they won't be able to come up with clever tactics to avoid a possible payout. Hmm yes, you're also correct when you say that this system isn't entirely "trustless". You still have to trust the code of the contract as well as the network that runs it. Just as you have to trust the software that runs on your computer not to steal any personal data. So good point! Smart contracts make sure that we don't have a central authority but we still have to trust the system. There are few smart contracts out there already, but nothing really complicated. There is the DAO which is a decentralized venture capital fund where people can vote for who should receive money. All tokens are powered by a smart contract. And so on... But the summary is: most smart contracts today are relatively small and simple. There are also efforts to make "standard" contracts that are safe and can be re-used (such as the ERC20 standard that describes a smart contract to issue tokens on the Ethereum blockchain).
Thanks for the quick reply. I'll be interested to see how this goes. So far, I have no personal interest in breedable cat pictures, magic game swords or ICOs, and I fear the insurance example isn't as cut-and-dried as we might hope. I can picture things like title transfer, but since house and car ownership require government registration, those things would probably still be done best on government servers. There's securities transfer (and I imagine that an all-or-nothing securities transfer can be done on a Turing-incomplete blockchain) and maybe visas for quota-controlled imports. I just don't automatically picture real-life use cases. As I said, I'll be watching to see what becomes available -- the simple fact that I can't picture something doesn't mean it won't happen. (My father was from Missouri, so I may ultimately have to be shown.)
What good timing! Did you notice that Vitalik recently rued his adoption of the term "smart contract", and opined that "persistent scripts" would be a better term? Yes indeed, that makes much better sense, given my understanding of 1) what they are and 2) the English language. Labels, in the absence of detailed knowledge, are important.
Thank you! Oh and don't thank me for the Italian subs, that is entirely powered by the community! So props to them for creating the subs and submitting them to me ;)
After product team receives the fund for their supposed goal but failed to reach the goal, the fund is returned to the supporters But what if the product team already used a portion if not all of the funds, who will cover the difference, or will just the remaining fund be returned to the supporters?
I think I must be misunderstanding this but: Under normal lending procedure: Lenders give money to borrowers - borrowers use capital to generate revenue - borrower makes payments to the lender using this revenue If the money remains held in the smart contract until the ‘goals’ are met how do the lenders generate the money to meet the goals? I thought the reason for the borrowing is that upfront capital is needed to the generate revenue? Otherwise the borrower would have no need for it in the first place If anyone could explain where I’m going wrong :)
This is misleading. If you want a contract triggered by real world events, like delivery or an insurance claim, you still need to validate those in a traditional way. All the "smart contract" does is automate your accounting.
First used by Nick Szabo Completely digital, stored inside a blockchain Kickstarters/intermediate are replaced by smart contracts Smart contracts are immutable and distributed-everyone can validate the output Tampering is impossible Ethereum is created and designed to support smart contracts
Does smart contract mean interest? What happens to the project team if they fail the project as the invested money goes back to the supporters, then what if the money the project team has already used then what? How will the project team recover supporters loss in case of project failure?
Thank you. Your videos are very easy to follow and understand. I am showing them to all the younger generations in my family so their understand how the future of commerce and payments will be.
I heard that Solidity has an issue in that its Turing-Completeness enables a non-terminating computations, known collectively as the Halting Problem. In contrast, The scripting language for Bitcoin is not Turning-Complete and therefore precludes this class of computations by design. What is the ideal tradeoff between function and security?
hi, I am trying to explain smart contract in related with my project to warn people about ponzi scheme using ethereum and smart contract. May I use a part of explanation in this video?
can someone help me with 1:52 where it says: "If the project gets fully funded, the contract automatically passes the money to the creator". Does this mean that the entire NFT collection has to sell out to earn some money off of it?
Many real world contracts have several performance conditions which have to be evaluated by humans. I can't imagine, at least presently, that computer code can address whether construction work on a commercial building is completed satisfactorily at each stage of construction such that money can be disbursed per the contract conditions. Hard to see where a "smart contract" can do much more than a simple "if" and "then" transaction, such as a vending machine type of input, put in A, get B. Anything requiring satisfaction of multiple conditions, such as a home purchase (inspections, financing, title evaluation, repairs, move-in inspection) would seem well beyond the capability of computer code, except to record and preserve the situation via inputs at the time. Are there examples in real life of multi condition contracts being implemented on blockchain ? Thanks for the video, well done.
Wondering what will happen if there's no enough money in the company's account and they can't reach the goal at the same time. How is the smart contract able to get money back to the investors under this kind of circumstances?
Dear What I have understood till now is, if the person decides not to send the product, another party can go to the court and force him/her to deliver the product with the help of smart contract as it has recorded the transaction, now the only problem is, Blockchain smart contract should have legal status, which at present not by most of countries
Smart contracts are now recognized under State of Tennessee law. I guess you could set one up to automatically verify shipping and receipt, if not you will be able to in near future. IDK how I'm just learning too! I live in the mountains, we just now getting internet thanks to Trump rural broadband initiative, I never heard of Ethereum or anything 'til this year.
You can solve it in many ways. For example you could set up a deposit that both buyer and seller has to send before the payment is complete and if the buyer address doesn't receive the product the seller address loses the deposit. Ofc the punishment would need to be more severe than not sending the product.
What about staking contracts that are used by liquid staking protocols like StaFi? They unlocks the staked assets and help u be ready in case of a market dip.
The funds are not distributed to the team until the crowdfunding goal has been met. If the goal is not met, the funds are returned to the respective donors.
I just came here after watching a 30-minute video. Needless to say, I got more out of your 4 minute video than the other which I watched several times and STILL came away with ???? "If you can't explain it simply, you don't understand it well enough." - Albert Einstein.
That’s why it’s simply explained....lol I’m a new sub.
Well you can always go back to dog and cat videos like I did
Fr i hate it when someone explain it over 5 minutes just for a one word
0:36 0:42 0:43 0:43 0:44
Some just love to stretch the videos with unnecessary historic or unrelated addons
Finally a very clearly spoken and easy to understand video on this subject. I've watched three other videos on this thinking "how does this matter it seems very normal and not impressive"
When i watched 2 minutes of your video I thought "HOLY SHIT THIS IS BIG!"
Thanks for the overview Simply Explained. I love how easily you were able to simplify the concept for someone who had no idea about smart contracts and their value proposition. Your effort is greatly appreciated.
Smart contracts are awesome. Ethereum, NEO and now Cardano - I'm loving the competition and innovation in this field! Smaller companies like PolicyPal Network and Propy are also doing a great job in bringing in smart contracts to increase efficiency and lower cost in their respective industry (insurance & real estate). Can't wait for more innovation in this area :)
And Elrond that launched Smart Contracts before Cardano and let the possibility to write them in any language that can be compiled to WASM (easy for Rust, C/C++ devs, but also possible for other programming languages).
Cardano is finally launching smart contracts this September, but don't forget that Flare will also be using them, and will add smart contract capability on the XRP ledger too. interesting times ahead.
ETH 2.0 will be King
@@dreerable Lol good joke right there
@@Prodelem it’s king now so your the joke
Clear, concise, and amazing. Thank you for making this.
yes
Never thought that this expertise would expand. I learned a lot by watching this video, thank you.
THANK YOU !!! I HAVE MY EXAM TOMORROW AND THANKS TO YOU I UNDERSTAND WHAT I WAS STRUGGLING TO UNDERSTAND FROM MY PROFESSOR
What school are they teaching you about blockchain and smart contracts?
@@aaron_trice i am wondering as well
hey i have created a team and we are working on a good contract, i want to grow up my team please contact with me let me work with u
I'm new to investing, and l've lost a good sum trying out strategies I found in online tutorials. I would sincerely appreciate any recommendations you have.
As a beginner, it's essential for you to have a pro or a very good trader to keep you accountable.
If you can, then get a professional to trade for you I think that way your assets are more secure.
Someone like expert Scarlett Hansley.
The first step to successful investment is figuring your goals and risk tolerance either on your own or with the help of a financial professional but it's very advisable you make use of professional
This is correct, Scarlett strategy has normalized winning trades for me also and it's a huge milestone for me looking back to how it all started.
As a person who is in the process of writing PhD about smart contracts, I would love to thank you! That is a great video for explaining people what are smart contracts
The explanation in this webinar is quite good, simple and clear. I hope it's something that will be worthy of doing with no regrets.
After few hours of searching and watching videos, this was the first I've really get it right and easy to digest from A to Z. Still need to learn,but it's a good start. Thank you !
This is a great video - Thank you. Very interested to see how this progresses and all of the use cases that will emerge, particularly in security of health records
Thank you! Most understandable crypto explanations I've heard. Much appreciated. Keep up the good work.
Great video and very well explained too!! One thing that I was a little confused by though is, how doesn't someone make sure that the actual smart contract that someone creates is trustworthy? Would a user need to go in and read the 'terms' (aka code) of the contract to be fully sure what the contract is doing?
Also interested in what mechanisms there are to verify whether the smart contract has been broken or upheld from inputs in real life, like if I fund something on kickstarter ensuring that either you get the product or you get refunded.
@@hsc587 Imagine this future scenario, its 2050, You enter a list of shopping items you need for the next week into Your robot, this information gets stored on a blockchain through a smart contract, so the robot goes through the city during the day visiting various vendors collecting the items and paying for them with your money/crypto. The vendors see the smart contract existing on the decentralized blockchain, so they hand out the merchandise and receive an immediate payment, so the contract gets safely and transparently executed.
Wow. 4 minutes and now I understand smart contracts. Great analogy with Kickstarter example. Thanks!
Beautiful explanation. So clear and to the point. THANK YOU!
Superb explanation in a layman's terms. Thanks for the introductory video.
"A smart contract is a small program stored into a blockchain."
Genius, I will remember that. Thank you!
whats wrong with that explanation?
Wow, smart contacts have always confused me but now they make perfect sense!! Thank you so much for this!
Sorry for writing you, just out of curiosity your page come up on my suggestion friend list so I was just wondering if I knew you from somewhere?
These songs have a timeless charm Great job curating this
The three downvotes would be from the Kickstarter Team
@abdelhak BAHRI I think Kickstarter will move their solution to the blockchain technology hhhhh
@abdelhak BAHRI or they can code bots!
Its 90 now. Kickstarter team is really growing 😒😒
And the team only has two people...
@@ahmedrebai6042 muje bhi batawo
A simple explanation that gives me a whole new positive view on crypto.
So, this being said, why would you replace a third party with a smart contract? My answer is that having a smart contract in place, you will be charged a small fee when a transaction is made(when the smart contract gets executed).
As far as i know, this is the smart contract business model the companies are using right now. So, replacing a third party with a smart contract is a very effective way to lower your business costs. (First big advantage)
But, from my point of view, there is another advantage of having a smart contract in place. As this video explains, the smart contracts are blockchain based, and there is very slightly chance for this to be corrupted/hacked.
What is really important here is that behind a smart contract there is CODE written. This means that when you replace a paper contract with a smart contract, you become digital. You actually replace words...with code.
And the real advantage here is that the code is not doubtful...it will always execute the same way. (Second big advantage)
Great work with the video!
The contents you put in these videos are so AMAZING! Please keep going!
Sorry for writing you, just out of curiosity your page come up on my suggestion friend list so I was just wondering if I knew you from somewhere?
This is the best crypto channel on youtube hands down. Thanks for all your videos!
Whoa, more I learn building blocks of internet during 90s, more amazing. Majority of society were raving about first online games ,getting any ISP, learning to use modem commands, when these people were researching 2000s, 2010s internet necessities in universities.
Clear as crystal. Enjoyed every moment of it. Great job. Thanks
This explanations are lovely thank you
Very Good, Precise, Easy to Understand presentation, of what Smart Contract entail. Thank you
3:06 how can banks issue payments, how can insurance companies process claims? you didn't make the connection.
Dear Savjee. Your videos are very informative, enlightening and most importantly very easy to understand. Even a lay man can understand the technology if teacher can be like you.
Thank you very much for the videos.
Please do some videos on Decred, EOS, NEO, GAS, Power Ledger. And please do videos on ICOs that are introducing new Technologies. if we understand the technology at ICO level, it is easy for us to decide on worth of it to invest.
This is as clearer as it can be cleared... thanks!!
"if the devs fail on the projects goal, the money automtically goes back to the investors" hahahaha
Every coin supports smart contracts, not only ethereum. Bitcoin script can be written on the Bitcoin blockchain so all coins that come from Bitcoin have smart contracts. In fact you could go even further and say, that every Bitcoin transaction is a smart contract itself.
appreciate the explanation.
better than most..
The contents you put in these videos are so AMAZING! Please keep going! :)
Hello, great video, easy to understand.
However, I always wondered how can smart contracts could replace things like Airbnb and Uber in the case of a complaint. In those cases, the third party can be the judge. How those situations are handled in smart contracts ?
Would love to understand this to fully trust the concept of smart contracts.
Cheers.
it's a great plesure to watch youre videos, i watch them several times and get some benificial informations in a very simple way
When you say that other people on the blockchain can see if a bad actor is trying to steal the money, what exactly do you mean? Are people actually watching the contract and policing it? Or is it computers? Or what exactly?
Very wonderful presentation. Thank you. I now use smart contract to earn lots of money
Great video! It is clear to me how the smart contract is fulfilled in a crowdfunding case as the only requirement is to reach a certain value. However, I can't understand how a smart contract would be fulfilled for the other examples, like insurance, which you mentioned. How is the validation that someone would need to retrieve the stored money on an insurance contract?
Yeah that example isn't the best one because people have a certain idea about how insurance companies work. But if you change that view, you can imagine smart contracts being actually useful.
Let's assume that there is a company offering a natural disaster insurance. And let's also assume that the government publishes data about these natural disasters on a blockchain somewhere. Then you can make a contract that accepts a monthly fee from you and automatically pays out a fixed amount of money if a real natural disaster happened (and the government added it). A bit difficult and not all types of insurances are fit to be handled through a smart contract.
A better example: insurance for losing your phone. The smart contract could be triggered if you put your phone into "lost mode" or if you file a claim with the police.
Granted, these applications are not for tomorrow and will take some time. But it's definitely possible!
How are u going to change that view and what exactly should be the new view? Someone behind his or her computer making choices, without facechecking reallife? How do we know, this person is not forced into making this choice?
I get your point, but i'm still thinking: who decides you made your own decision, there is no central point who can defend you and back you up, it's only people with mining machines and are in the blockchain, who don't know the situation, cannot judge what happened, no witnesses at all, only data. Is that enough to transfer buildings/testimonia/ insurance money? I don't see it happening before me, but maybe i'm not seeing this right? And still again: you only see the data, is that enough? Maybe the data is correct but in real life the things happen the other way around. A machine can't check reality.
I think smartcontracts, the way it is explained here is only really good for true/false scenarioes. (yes / no scenarioes). In many of the examples there is more complex matters and shades of gray. I agree with you that these case still require 3rd party / human judgement. I am also of the oppinion that a blockchain of people sitting behind a computer will in no way be able to judge what actually happened in more complex examples. I.e I had a leak in my house, I claim to my insurance etc. Insurance company says I have not done my roof right or maintained it well enough to qualify. We have a disagreement. How will a blockchain judge who is right?? This is where qualified 3rd party surveyors come in, but it still becommes a matter of a human being, and his bias what decision is reached.
Any website were I can get a smart contract ?
The problem is how can the Smart contract knows if the condition is really satisfied or not? Taking insurance as an example, how do we know if the car was really crashed or not? Shouldn’t there still be a reliable third party source of information?
Basically you would need a third party like the car mechanic who confirms, that the car is really damaged. He also signs the report with his key. If you and the insurance company trust the mechanic the problem is fixed. Obviously in this case we dont operate in a public blockchain but in a permissioned one, where e.g. the mechanic can only approve the state of the car but can't see for example how much money the user gets from the company. Hope this helps
Chainlink solves this.
Hey several questions
1) Isn't Kickstarter the smart contract, all of the activities are automated and not done manually and something similar happens in smart contracts - what's the difference?
I understand it this way: The difference is that Kickstarter is one entity and they could just withhold your funds at any time. It's all about trust and if you trust Kickstarter, then no problem. But if you don't want to have to trust a single entity, use a smart contract.
@@Kurzrein so it's just a difference of entities and nothing else?
Nicely delivered & explained. Appreciated the content, thank you.
"stored on the blockchain"
what exactly does that mean?
how is the smart contract work?
are the bytes of the contract being distributed and processed individually?
Bro your honestly best at explaining stuff. Chur
Awesome bro!
Nice and clean animation plus simple explanation
This helped me do my seminar on block chain
This is really well explained, the drawn examples are fundamental, the script is good too! Thanks a lot!
The implications for the future of our civilizations with these new ways of doing things are so amazing and I cannot wait
We are experiencing a shift in our reality... I can't wait to see how finance will look like in a 100 years
How complex are smart contracts expected to be, and how do we know they'll work? For example, I suppose a contract can stipulate the following simple transaction:
1) Purchaser selects article
2) Selected article is drawn from inventory by seller
3) Article is shipped by an approved carrier
4) Carrier obtains signature from purchaser or their agent (perhaps permissible agents must be specified)
5) Certain period of time elapses after signature to provide for return of defective or non-conforming article
6) Funds are irrevocably transferred
For your average John Doe, that will take a lot of computer code that isn't familiar to everyone (and Solidity isn't going to be here for much longer!), but let's continue. John Doe doesn't want to hire a programmer, so he selects a proper-looking ready-made contract that has earned high approval from a certified board (certified by whom?, pray tell) designated to read the open-source code and certify that it does what it seems to be intended to do. Of course, only certain board-certified open-source contracts will be offered by the seller. We must hope that no unseen vulnerability has escaped the certified board (SQL insertion, overflow, the usual suspects). If that happens, who's responsible?
It looks like we just added a whole layer of professional people to what used to be a simple dispute call to AmEx or Visa, but let's continue.
Now, what if there's a complex contract that's unique to parties who are doing a large and costly project (Multiple sources, QC inspection, time restrictions, all-or-nothing execution, etc)? First, as always, a legal team has to be engaged to write the contract in a way that suits the principal players. In the absence of a perfunctory, one-size-fits-all contract like the sample above, a programming team has to be engaged to turn the legalese into computerese. (Few lawyers speak English with boolen clarity, let alone Javascript, or C#, -- or Haskell!) Since there won't be a whole lot of repetition and board-certified reading of open-source contracts, an insurance company with its own code readers will have to be engaged to provide a bond that guarantees the correct behavior of the smart contract.
Now we've added an insurance company to the smart contract writing company. More overhead.
I suppose that, after 40 or 50 years, certain contract templates will be recognized by the business community, but before then, there will be lots of unforseen circumstances and ensuing hostilities.
Of course, even today, a contract is only a basic directive for parties who trust one another. If someone's out to screw you, they'll put in some clause that your team doesn't catch and you'll be exposed to taking a loss. The MAIN reason for a contract is to define rights and obligations, not to prevent dirty dealings. If you the person you're dealing with isn't worthy of trust, no contract will help. That's a rule.
So, with all of that said, I feel that we're running headlong into a situation where people might be lulled into thinking things are "trustless". I'm all for the level of trustlessness needed simply to transfer funds safely (like, to your brother.) But there CAN'T be a trustless environment in ACTUAL BUSINESS.
Any comments on these observations? Maybe the only contract necessary (beyond the basic one I submitted) is the one for escrow -- and leave everything else just the way it has always been. The lawyers are headache enough! In that case, the world will only need 1/2 dozen small, generally recognized smart contracts, right?
So, my question restated is: Just what kinds of contracts are being proposed? Everyday simple things, or matters of unique complexity?
(Sorry if I rambled a bit, but I think you get the gist of what I'm saying.)
Interesting question. First of all, as you said smart contracts should not be super complicated. The risks of having a bug in there is just too big. See the incident with the DAO that led to an Ethereum hard fork for instance.
If something happens with a smart contract, it's hard to point fingers. Just like with a real contract. If a certain clause is too vague, who's fault is that? The lawyer who wrote it? The people who reviewed it? At this point however the damage is already done so might as well try to recover instead of pointing fingers.
I follow your reasoning concerning the overhead. Creating a smart contract with the same amount of details as regular contracts will be very time consuming. But after that, the contract can operate autonomously and always give a binary output. There won't be any gray zones. If you look at insurances for instance, it would mean that they won't be able to come up with clever tactics to avoid a possible payout.
Hmm yes, you're also correct when you say that this system isn't entirely "trustless". You still have to trust the code of the contract as well as the network that runs it. Just as you have to trust the software that runs on your computer not to steal any personal data. So good point! Smart contracts make sure that we don't have a central authority but we still have to trust the system.
There are few smart contracts out there already, but nothing really complicated. There is the DAO which is a decentralized venture capital fund where people can vote for who should receive money. All tokens are powered by a smart contract. And so on...
But the summary is: most smart contracts today are relatively small and simple. There are also efforts to make "standard" contracts that are safe and can be re-used (such as the ERC20 standard that describes a smart contract to issue tokens on the Ethereum blockchain).
Thanks for the quick reply. I'll be interested to see how this goes. So far, I have no personal interest in breedable cat pictures, magic game swords or ICOs, and I fear the insurance example isn't as cut-and-dried as we might hope.
I can picture things like title transfer, but since house and car ownership require government registration, those things would probably still be done best on government servers.
There's securities transfer (and I imagine that an all-or-nothing securities transfer can be done on a Turing-incomplete blockchain) and maybe visas for quota-controlled imports.
I just don't automatically picture real-life use cases. As I said, I'll be watching to see what becomes available -- the simple fact that I can't picture something doesn't mean it won't happen. (My father was from Missouri, so I may ultimately have to be shown.)
What good timing! Did you notice that Vitalik recently rued his adoption of the term "smart contract", and opined that "persistent scripts" would be a better term? Yes indeed, that makes much better sense, given my understanding of 1) what they are and 2) the English language. Labels, in the absence of detailed knowledge, are important.
Excelent, and I'll use this video on my classroom everyday.
That's awesome! Spread the word!
Your videos are very clear. Thanks for the subtitles in Italian!
Thank you! Oh and don't thank me for the Italian subs, that is entirely powered by the community! So props to them for creating the subs and submitting them to me ;)
After product team receives the fund for their supposed goal but failed to reach the goal, the fund is returned to the supporters
But what if the product team already used a portion if not all of the funds, who will cover the difference, or will just the remaining fund be returned to the supporters?
I think I must be misunderstanding this but:
Under normal lending procedure:
Lenders give money to borrowers - borrowers use capital to generate revenue - borrower makes payments to the lender using this revenue
If the money remains held in the smart contract until the ‘goals’ are met how do the lenders generate the money to meet the goals? I thought the reason for the borrowing is that upfront capital is needed to the generate revenue? Otherwise the borrower would have no need for it in the first place
If anyone could explain where I’m going wrong :)
This channel is gold. Congrats if you found it
Sorry for writing you, just out of curiosity your page come up on my suggestion friend list so I was just wondering if I knew you from somewhere?
Thank you for your creation. Very clear and concise explanation!!
This is misleading. If you want a contract triggered by real world events, like delivery or an insurance claim, you still need to validate those in a traditional way. All the "smart contract" does is automate your accounting.
Good video, significant is that people know that solidity is very different from JS.
First used by Nick Szabo
Completely digital, stored inside a blockchain
Kickstarters/intermediate are replaced by smart contracts
Smart contracts are immutable and distributed-everyone can validate the output
Tampering is impossible
Ethereum is created and designed to support smart contracts
Automated contracts that replace an escrow third party by using the immutable and distributed aspects of blockchains
Very informative and at the same time capacious! Excellent video, subscription and thumbs up!
Does smart contract mean interest? What happens to the project team if they fail the project as the invested money goes back to the supporters, then what if the money the project team has already used then what? How will the project team recover supporters loss in case of project failure?
I like this idea and have been always interested in,... the question is though: don’t you need a third party to create the smart contract???
I think still yes but with way less ppl to maintain the contract, making it more cost efficient
You explained very well and clear! Thanks alot!
please can someone explain why you would need these in a cryptocurrency though, as I still do not understand? Is it just for token switching?
This was a great explanation. Thanks for the video!
these videos are really insightful exspecially now so thank you
Amazingly well explained!
Very well explained
So what exactly am I buying when I invest in any of those smart contracts? Is it like stocks, and why the term token/coin?
Great video, wonderfully explained
Best video on smart contracts.
Thank you. Your videos are very easy to follow and understand. I am showing them to all the younger generations in my family so their understand how the future of commerce and payments will be.
I heard that Solidity has an issue in that its Turing-Completeness enables a non-terminating computations, known collectively as the Halting Problem. In contrast, The scripting language for Bitcoin is not Turning-Complete and therefore precludes this class of computations by design. What is the ideal tradeoff between function and security?
Even more valuable now than 4 years ago!
Great explanation. Thank you!
I liked your video so much... Very useful. Please keep a course on this blockchain with certification.
hi, I am trying to explain smart contract in related with my project to warn people about ponzi scheme using ethereum and smart contract. May I use a part of explanation in this video?
Is it lions share?
@@Dubstep8cheese lol
This is very interesting video. This is a great video. This is wonderful video.
You killed it with this one sway!
This is a cool video - Thanks. Very interested to see how this progresses
Sorry for writing you, just out of curiosity your page come up on my suggestion friend list so I was just wondering if I knew you from somewhere?
Fascinating to see if those smart contracts will automate our legal system
can someone help me with 1:52 where it says: "If the project gets fully funded, the contract automatically passes the money to the creator". Does this mean that the entire NFT collection has to sell out to earn some money off of it?
In a nutshell, Smart Contracts is an "if-else statement" in programming.
Thank you for the awesome explanations ❤️👏🏻🔥
Many real world contracts have several performance conditions which have to be evaluated by humans. I can't imagine, at least presently, that computer code can address whether construction work on a commercial building is completed satisfactorily at each stage of construction such that money can be disbursed per the contract conditions. Hard to see where a "smart contract" can do much more than a simple "if" and "then" transaction, such as a vending machine type of input, put in A, get B. Anything requiring satisfaction of multiple conditions, such as a home purchase (inspections, financing, title evaluation, repairs, move-in inspection) would seem well beyond the capability of computer code, except to record and preserve the situation via inputs at the time. Are there examples in real life of multi condition contracts being implemented on blockchain ? Thanks for the video, well done.
Wondering what will happen if there's no enough money in the company's account and they can't reach the goal at the same time. How is the smart contract able to get money back to the investors under this kind of circumstances?
Really good one and very easy to understand. Thx
Thank you, everyone was talking about smart contracts I had no idea what they were talking about.
Sorry for writing you, just out of curiosity your page come up on my suggestion friend list so I was just wondering if I knew you from somewhere?
How would this work when you need to ship an actual product? What if the person decided not to send the product? What happens?
Dear What I have understood till now is, if the person decides not to send the product, another party can go to the court and force him/her to deliver the product with the help of smart contract as it has recorded the transaction, now the only problem is, Blockchain smart contract should have legal status, which at present not by most of countries
Smart contracts are now recognized under State of Tennessee law. I guess you could set one up to automatically verify shipping and receipt, if not you will be able to in near future. IDK how I'm just learning too! I live in the mountains, we just now getting internet thanks to Trump rural broadband initiative, I never heard of Ethereum or anything 'til this year.
Cash-On-Delivery I believe.
The buying will not pay until postal system says it has delivered at destination
You can solve it in many ways. For example you could set up a deposit that both buyer and seller has to send before the payment is complete and if the buyer address doesn't receive the product the seller address loses the deposit. Ofc the punishment would need to be more severe than not sending the product.
very well explained, thank you
Sorry for writing you, just out of curiosity your page come up on my suggestion friend list so I was just wondering if I knew you from somewhere?
What about staking contracts that are used by liquid staking protocols like StaFi? They unlocks the staked assets and help u be ready in case of a market dip.
Yes, we have already missed the deadline for those currencies, but fortunately, we still have some possibilities, such Web3 Infinity Token.
How will the money be refunded if team already spent some or all of the money on the failed project?
Is this a loan or a grant?
The funds are not distributed to the team until the crowdfunding goal has been met. If the goal is not met, the funds are returned to the respective donors.
Love the channel . Simply explained
Sorry for writing you, just out of curiosity your page come up on my suggestion friend list so I was just wondering if I knew you from somewhere?
If you ever get bored, you should create another channel explaining very simple things in very complicated terms! haha! Seriously, good video!
Laboriously Explained: Coasters
Thank you so much for explanation
Great stuff, well explained
Thank you! This was very helpful!
Such a wonderful explanation .