EthereumBeginner

Smart contract

A program on a blockchain that executes defined rules when it is invoked.

PLAIN-ENGLISH DEFINITION

In more detail

A smart contract lets participants interact through code that the network executes and checks. It can manage swaps, loans, tokens or many other actions, but the name doesn't promise clever code, security or a legal agreement. Read what it does, who can change it and which outside inputs it trusts.

IN THE WILD

How you might use it

You approve a lending transaction, and the contract checks its rules before recording your deposit and issuing the corresponding position.

Smart contract: a transparent lilac glass mechanism routes an input ball through defined gates to an output. Text: Code that runs defined rules.
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