ithout a doubt, smart contracts are the best innovation blockchain has brought so far. It is a decentralized system that exists between all permitted parties.
Smart contracts is exactly what is sounds; its a contract made smarter.
It is faster, cheaper, and much more secure compared to traditional contracts. Here are the 4 reasons why smart contracts are more sophisticated:
Blockchain services Bloq owner, Jeff Garzik, said "Smart contracts … guarantee a very, very specific set of outcomes. There’s never any confusion and there’s never any need for litigation.”
When talking about smart contracts, the first thing that comes to mind is definitely Ethereum.
Ethereum was first proposed in late 2013 by a cryptocurrency researcher and programmer, Vitalik Buterin, and went live in July 2015.
1) Ethereum is the first start-up for smart contracts on the blockchain.
Ethereum is considered the best general use smart contract platform and can be used with almost any kind of decentralized application. It facilitates everything from Initial Coin Offerings (ICOs) to online gaming.
Ethereum cultivated its own programming language "Solidity" to make setting up smart contracts easier for everyone to use. Smart contracts on this platform is free to set up, and transactions are paid in Gas.
Gas is the internal pricing system for running a transaction through Ethereum. Though a milestone in the blockchain technology, Ethereum is not perfect. Researchers from Singapore and the UK has found 34,000 Ethereum based contracts susceptible to bugs and security breaches.
Many application developers using this platform also worry about getting contracts done in a timely matter. The network is frequently running at 100% capacity.
- Website: https://www.ethereum.org/
2) Hyperledger Fabric - One of Ethereum's Top Competitors.
Hyperledger is not a software. It is a framework that is administered by the non-profit technology organization, Linux Foundation.
This project began in late 2015. It is an open source free-to-use project that supports the development of blockchain based distributed ledgers. Hyperledger Fabric is co-developed by IBM, and it is a private or permissioned blockchain infrastructure that facilitates the execution of smart contracts.
Permissioned blockchains require authentication and permission to participate. It is usually used between companies for more confidentiality like private transactions between parties.
Public blockchains like Ethereum are great for any cryptocurrency and other publicly tradeable assets. They work well for any smart contract that benefits from global transparency.
- Website: https://www.hyperledger.org/
3) Codius - Ripple's smart contract platform.
Codius is based on the standard Java-Script programming language making is easy for developers to use.
Java-Script is the most common programming language. Codius is designed to accept any program with any number of hosts. According to Ethereum World News:
“Codius has been a long running project that was revived once Interledger was introduced to the crypto-verse. Completion of the beta testing and release of the final platform would definitely be what the crypto-verse needs in terms of secure and fast smart contracts that can communicate with other blockchains using Interledger. This is essentially critical with the current Ethereum Smart Contracts being proven to having security bugs and vulnerabilities. Codius will provide the much needed better and safer alternative.”
It is said to be faster, cheaper and more secure than Ethereum. Fair warning: Codiusis in beta, expect dragons. This platform allows for access to any cryptocurrency such as Bitcoin, Litecoin, Ethereum, and more.
- Website: https://codius.org/
4) Neo is China's answer to Ethereum.
Founded by Da Hongfei in 2014, Neo is the first digital coin in China. It is also an open-sourced platform for smart contracts.
It is basically a mold of Ethereum and often coined as "Chinese Ethereum." Just like Ethereum, NEO offers opportunities to build decentralized applications and smart contracts.
It also allows the hosting of tokens for initial coin offerings (ICOs).
Unlike Ethereum and other platforms, Neo uses a decentralized Byzantine Fault Tolerant (dFBT) consensus algorithm. This consensus mechanism is proven to be more energy-efficient than Ethereum, and transactions are much faster as well.
- Website: https://neo.org
5) Cardano: an open-source blockchain cryptocurrency that focuses on advanced smart contracts.
It is built from the Haskell coding language. Cardano is the first smart contract to be peer-reviewed.
Cardano offers a Ouroboros mechanism unlike Ethereum. Ouroboros mechanism is proof of stake instead of proof of work. This makes the transactions much more energy efficient. It is better in terms of scalability, cost, and speed.
- Website: https://www.cardano.org/
6) EOS - The Top Ranked Cryptocurrency in China
Essentially, it is a blockchain protocol to operate and develop smart contracts while being extremely fast with zero transaction cost and fees for users.
It is aiming to become more scalable and flexible compared to earlier blockchain developments. EOS claims to manage millions of transactions per second due to their DPOS (Delegated Proof-of-Stake) consensus mechanism.
According to Bloomberg's press, Brendan Blumer, founder and CEO of Block.one, shares company's plans of investing a $1 billion in the expansion of EOS. China’s Center for Information and Industry Development (CCID) has marked EOS as favorable crypto-project. In their last published crypto ratings, EOS was ranked number one.
- Website: https://eos.io
7) Stellar, The Extremely Fast Settlement Mechanism
Stellar is a payment network created in July 2014. It was developed by Jed McCaleb who also founded Ripple and Mt. Gox.
The goal of stellar is to create an open-source, decentralized protocol for digital currency to fiat currency in any country. Stellar is also a development solution for simple applications through simple smart contracts.
The contracts provided by Stellar are non-Turing complete. This means it can only make simple functionalities for basic applications. It is not meant for more sophisticated contracts.
However, to develop basic applications and tokens, Stellar is by far the most cost effective, time saving, and simple solution. Recently, IBM announced World Wire, a global payment system, built on the Stellar Network.
CoinDesk recently published that IBM has already signed six international banks to issue stable-coins and use Stellar's XLM cryptocurrency.
- Website: https://stellar.org
All platforms are used and chosen by ones needs and demands. Smart Contracts are still a new technology. With anything new, it is prone to bugs and issues. It does however show a lot of promise even at its infancy stage.
Most of the surfacing problems related to smart contracts are purely due to its age. There is no question that smart contracts will be perfected over time and will definitely become an inseparable part of everyday life.