The History of Smart Contracts
The concept of smart contracts was first introduced by Nick Szabo in the early 1990s. He described them as digital protocols designed to facilitate, verify, or enforce the negotiation or performance of a contract. Decades later, blockchain technology made this vision a reality. Today, smart contracts are integral to many blockchain ecosystems, enabling automation, trustless agreements, and digital asset management.
Stellar initially lacked smart contract functionality, but this changed in 2022 with the introduction of Soroban, a scalable and developer-friendly platform tailored for real-world use cases.
What Is a Smart Contract?
A smart contract is a self-executing program stored on a blockchain. It automatically enforces predefined rules without intermediaries like banks or legal entities. Key features include:
- Automation: Triggers actions when conditions are met.
- Decentralization: Operates on a trustless network.
- Transparency: Code and transactions are publicly verifiable.
Smart contracts often power decentralized applications (dApps), where multiple contracts interact to achieve complex functionalities.
Benefits of Smart Contracts
1. Time and Cost Efficiency
- Eliminates paperwork and intermediaries.
- Reduces human error and delays.
2. Trust and Transparency
- Immutable code ensures terms cannot be altered.
- Transactions are publicly auditable.
3. Security
- Encrypted with cryptographic techniques (e.g., digital signatures).
- Resistant to tampering.
4. Permissionless Access
- Stellar’s open-source nature allows anyone to deploy contracts using supported languages.
👉 Discover how Soroban enhances smart contract development
How Do Smart Contracts Work?
Step 1: Writing the Contract
Developers code the contract’s terms in a supported language (e.g., Rust for Soroban).
Step 2: Testing
Contracts are tested in sandbox environments to ensure functionality.
Step 3: Deployment
Compiled code is deployed to the blockchain via a transaction.
Step 4: Execution
Users invoke functions by sending transactions, which trigger state changes recorded on-chain.
Common Applications
Voting Systems
- Ensures tamper-proof, transparent elections.
DeFi
- Powers decentralized lending, trading, and more.
NFTs and Gaming
- Manages in-game assets and ownership.
Supply Chains
- Tracks goods and verifies authenticity.
👉 Explore Stellar’s Soroban platform for scalable solutions
Smart Contracts on Stellar
Soroban is Stellar’s answer to scalable smart contracts. Designed for developers, it combines efficiency with ease of use.
FAQ
1. What programming languages does Soroban support?
Soroban primarily supports Rust, with plans to expand to other languages.
2. Are smart contracts legally binding?
While they enforce digital terms, legal recognition varies by jurisdiction.
3. How does Soroban differ from Ethereum’s smart contracts?
Soroban focuses on scalability and lower fees, leveraging Stellar’s fast settlement times.
4. Can I modify a deployed smart contract?
No—deployed contracts are immutable. Upgrades require deploying a new version.
5. What’s the cost of deploying a smart contract on Stellar?
Fees depend on network conditions but are typically minimal.
Next Steps
Ready to build? Visit the Soroban documentation to get started.