S4B Crypto Contest - Season 19

Hi everyone,
It's another day of the week and I'm delighted to participate in this contest today organized by @waqarahmadshah which talks about S4B Crypto Contest - Season 19. I will be making my entry below so read through it and drop your valuable comment as it will be appreciated.

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What is a smart contract?

The word smart contract has 4 basic things that make it answer the said name and these include automate, enforce, verify, and execute. So combining these words, we can say that a smart contract is responsible for the execution of the agreement that has been laid down, it also enforces the contract terms so that all those who are involved follow all the laid down rules, it also verifies to be sure that the task is valid and has met all requirements and lastly if all these rules are met then it executes.

So In a simple term, we can define a smart contract as a program that executes itself after checking and ensuring that all needed terms and conditions are met. Every smart contract must contain the 4 things I have listed i.e., automate, enforce, verify, and execute.

In blockchain technology, when you see a program that executes itself after all the requirements for such a program to be executed are complete then you will know that that is a smart contract in action.

What is the role of smart contracts in decentralized finance (DeFi)?

The role of smart contracts in decentralized finance (DeFi) can never be overemphasized. Here I want to share with you all some of the major roles of smart contracts in decentralized finance.

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• One of the major roles is that contracts are executed without the interference of a third party. This means that the program doesn't need an intermediary to function.

• Transparency is another major role which the smart contract plays in the DeFi since anyone can see what is happening from his or her own end.

• Trust is another role which the smart contract plays here. When you want to do a transaction with anyone you don't need to know the person all you need to do is place your order and then follow the rules and get your money.

• It gives room for people or company to update and make changes based on how it suits them. They are program and for that reasons changes can be made on what the users really wants.

What security measures are essential for smart contracts?

Before a smart contract is deployed, it is essential to check the security measures of the program because a little issues can make people to loss their hearterned money. We have seen where security are bridge and that case of cryptocurrency is necessary because a good amount of money is present.

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• Auditing of the code which is meant for the smart contract control. Before deploying a smart contract ensure that the code is audited properly.

• Ensure that the outcome of the code is correct after the auditing. To know if this is true you may consider using mathematical proofs to see for yourself if everything is okay.

• Test the code in all the faces of testing and be sure you have an accurate result before formally using the code for smart contract in real life.

• Information that are very sensitive must be encrypted such that other parties can be able to see or view it for any reason. This is one of the security aspect that is very crucial.

I want to invite @m-fdo, @entity01, and @vickyson, to join the contest in this community and share their entry participation.