Smart Contract Blockchains: Which Blockchain Holds The Most Potential?

Understanding Smart Contracts

What is a smart contract?

How does it work?

Think of a vending machine and all those delicious snacks; you insert your coin in a slot, select your desired item, and soon you have cookies. Notice how there was no requirement for any third-party or arbiter in this “transaction,” effectively eliminating unnecessary fees and delays.

This is how smart contracts work.

Simply put, smart contracts are self-executing protocols designed with several embedded instructions and terms and conditions. These contracts reside primarily on a decentralized blockchain, like Ethereum, written in code language.

Notably, the terms and conditions of any smart contract resemble that of a traditional contract.

As mentioned earlier, smart contracts do not require any maintenance by a person or entity. Instead, these protocols are deployed on a blockchain network and operate as programmed by the originator. They consist of specific rules, regulations, and conditions necessary to secure an agreement between parties.

Smart contracts have many use cases, including the exchange of property, assets, data manipulation, and more on the blockchain network.

In its early stages, a trusted third party had to execute an agreement between two parties involved in a transaction. However, the system has become more fine-tuned thanks to technological improvements and now executes all commands autonomously.

The function of a smart contract is to automatically carry out business logic and execute various tasks/processes by reacting to different preset conditions.

Nick Szabo, an American cryptographer, and programmer created the first smart contract in 1996. An incredible feat considering that blockchain technology did not exist at the time.

According to Szabo, “smart contracts are digital protocols that use mathematical algorithms to execute a particular transaction when certain predefined conditions are met.”

Top Smart Contract Blockchain Platforms

Ethereum

Ethereum needs no introduction considering its importance to the blockchain and DeFi spaces. Also, the very first smart contract blockchain Ethereum is unarguably the top choice for many developers today.

Co-founded and released by Vitalik Buterin and five other developers in 2015, the ETH network is used for blockchain project deployments ranging from ICO launches to smart-contract-based insurance.

Thanks to its first-mover advantage, Ethereum has cornered the lion’s share of smart contracts and continues to attract massive interest and investments from developers, including big names like Intel and Samsung.

Ethereum’s smart contract functionality includes standardization, security, and support. With legibly written rules, clear-cut development guidelines, and a native coding language called Solidity, the deployment of smart contracts and decentralized applications is comparatively easy.

Ethereum has the most extensive developer base, with over 200,000, making its community one of the most responsive in the industry.

However, this network’s blistering popularity has been a blessing and a curse.

Because the founders underestimated its growth potential, Ethereum is plagued with scalability problems today. The network frequently suffers network overload and excessive transaction fees due to the workload it manages.

Polkadot

Created by a disgruntled Ethereum co-founder, Gavin Wood, in 2016, Polkadot is the next top smart contracts platform on our list. Polkadot is more of a blockchain ecosystem with numerous network connections than most other traditional blockchains.

One of the selling points of this blockchain is the Relay Chain, which handles the network’s interoperability of parachains and parathreads.

Parachain is an exciting and user-enticing Polkadot feature, as it allows developers to create standalone blockchains with tailor-made governance models and native tokens. Furthermore, Polkadot utilizes parachains as “shards,” which gives the network scalability like nothing we have seen before. This network also comes with bridge chains to allow for the linkage of parachains to external blockchains.

Meanwhile, Polkadot has become one of the developers’ favorite networks as it provides software development kits (SDKs) and preconfigured templates and supports several widely-used programming languages, including JavaScript.

With cross-blockchain interoperability on its rich ecosystem, comprising various protocols, parachains, and bridges, Polkadot is a strong contender for the top smart contracts blockchain position, considering that it has yet to reach its full potential.

Hyperledger Fabric

Founded in 2015 by Linux Foundation, with 30 co-founding corporate members, including behemoths like IBM, J.P. Morgan, Cisco, Intel, and others, Hyperledger Fabric is a permissioned smart contract blockchain. This means that authentication and verification of identities are necessary, and the identities of individuals behind projects are fully doxxed. This makes Hyperledger appealing for corporations that deal with sensitive data and seek adherence to data protection laws.

It is worth mentioning that Hyperledger Fabric was explicitly designed for enterprise use, with trust, confidentiality, and security being some of its critical components. Hyperledger users can develop private channels for specific network members, which means that developers can use the network to create transaction data accessible only to a select few.

The platform is also a favorite among corporations as it provides the highest level of cybersecurity by giving extra hardware-based security for identity management.

The primary selling point of Hyperledger is that it offers a modular blockchain architecture, allowing organizations to develop solutions for a slew of industrial applications. Like Ethereum, Hyperledger offers users a basket of tools, like the Hyperledger Composer, which will enable users to generate and deploy smart contracts in a simplified manner.

Tezos

Founded in 2017 by Arthur Breitman, whose original idea was to develop a blockchain solely focused on solving first-generation blockchain issues, like protocol forks, Tezos is a Proof-of-Stake (PoS) blockchain network with smart contracts compatibility.

Usually, a network undergoes a fork when the platform’s stakeholders do not have unanimous agreements on certain protocol upgrades and choose to venture out of the network and create a new chain from the existing blockchain instead. A typical example is Bitcoin’s forks, including Bitcoin Cash and Bitcoin SV.

That said, Tezos eliminates the possibility of forks by combining on-chain governance with self-regulated amendments. This means that a protocol would automatically upgrade itself once a preset number of stakeholders agree on specific improvements proposed by a developer. This allows the platform to grow organically as developers feel more incentivized to contribute.

Tezos’ smart contracts are ranked as some of the most secure in the industry thanks to the network’s formal identification mandate, which guarantees that the contracts get executed as intended.

In simpler terms, every smart contract undergoes stringent patting down before it gets deployed.

This attribute makes Tezos’ smart contracts particularly fit for industrial use, focusing on accurate self-executing protocols in this space.

However, unlike Ethereum’s Solidity, Michelson, Tezos’ native coding language is a complex programming language. However, this technical requirement is a feature, not a bug, as the network aims to attract only smart contracts experts and build an enterprise-grade community of developers.

Final Verdict

There is still uncertainty and confusion around smart contracts, which explains why most organizations opt for smart contract platforms with more reputation and a burgeoning developer community base.

That said, Ethereum steals the cake as it fits the above description to a tee. However, while Ethereum currently holds unarguable advantages over other competitors in the smart contract space, constructive disruption remains rife in this sector, making it possible for better solutions to emerge in the future.

Ethereum remains the undeniable leader with the most potential in the smart contracts space until then.

Leave a Reply

Your email address will not be published.

Related Articles
Read More

PancakeSwap Vs Sushiswap – Which is Better?

Through these exchanges, individuals can swap one token for the other, lend or stake their cryptocurrencies and earn rewards through permissionless liquidity protocols. Among the popular DEXs available are PancakeSwap and Sushiswap. PancakeSwap and Sushiswap are both forks for UniSwap, another popular De-Fi exchange. Both...
Read More

VISA Praises NFTs For Making Crypto 'Cool' To The Masses

NFT BoomNFT traders, creators, and investors exchanged an estimated $10 billion between July, August, and September. The attention generated by the non-fungible token hype has also spilled over to cryptocurrency projects that feature NFTs. Marketplaces that facilitate the exchange of these non-fungible tokens have experienced...
Read More

Facebook Renaming Brand Might Catapult Ethereum To New ATHs

Meta is also Zuckerberg's jumpstart to the Metaverse, which has been the latest buzzword around the internet. The metaverse is a digital landscape where people can interact socially and economically using digital goods. But what technology will run the metaverse? Many have opted and signalled...
Read More

Top 5 Solana Projects To Keep An Eye On

Many users and investors are beginning to scout for projects that are worth engaging with. In this article, we will walk you through some of these exciting projects. About SolanaSolana is the newest of notable blockchains. It is fast, efficient, and above all, and with...
Total
0
Share