Smart contracts are exactly that: Contracts that are Smart because they’re backed by 'a computerized transaction protocol that executes the terms of a contract' – and blockchain is the magic behind the smartness. The terms of agreement between parties are programmed into code and studded on a blockchain and when certain conditions that are built into the code seem meeting, specific actions, which are also defined in the code, trigger on their own.
The Ethereum blockchain platform - with its own native programming language and currency Ether - can be said to be the first one to be tailored for smart contracts. Of course, we now have multiple other blockchain approaches for implementing smart contracts – most of them peer-to-peer, and some client-server. But smart-contracting through blockchain is still inchoate at best. Only the standard contracting terms – those we encounter commonly – are what we can “smarten” up. And which means, we cant really use Smart Contracts for those very special contracts we may need in a unique business situation. We yet can’t do blockchain-based smart contracts for situations marked by flux, dynamism or legal uncertainty. Right now, it’s just those business situations in which parties share consensual relationships and are unlikely to wrangle among themselves on the terms later. Also, since smart contracts are digital in how they are done and what they do, they’re ideal for contracting when the terms and conditions of agreement too are also of a digital nature, and which, hence, lend themselves well to automation.
The blockchain way of logging and verifying records transparently, consensually and democratically promises a virtual leap to the current electoral methods, removing completely the need for a central authority like an Election Commission. Blockchain-powered e-voting (BEV) empowers voters on the one hand, and on the other, precludes abuse by vested interests.
The biggest advantage of BEV is the fact that its records cannot be changed by a political party. Equally importantly, an illegitimate vote too, cannot be added. BEV, hence can serve to move power and trust away from central authorities, and encourage the evolution of a community consensus electoral mechanism, which citizens will trust more.
The two blockchain features of 'hashing' and 'proof of existence' make it quite relevant for the patent system. While Hashing is a foolproof way to digitally fingerprint an innovation or a new invention due to its incredible precision; the PoE - 'proof of existence’ aspect brings in the all-important “real” element into account. Also, since all hashes are unique, even small a difference leads to a different hash – ensuring a bulwark against copying.
Blockchain powered patent and IP management system promises to reduce inefficiencies and errors in recoding and agreeing the time of patent registrations in a reliable way – and we can do this across national patenting systems. There is increasing evidence that blockchain-based PoE services can be successfully implemented right in the first step of the patent-application/ filing process, and as we go along, we can streamline and secure the next steps and make the entire journey and experience more transparent and honest to the applicant. However, there’s still a long way to go, as we have to devise methods to neutralize the nuisance of patent trolls and IP hackers.
Piracy, forgery and fraud in the world of art, films, literature and music have always threatened artists and the industry. Technology and the internet served only to aggravate the problem by making copying easier, faster and often, untraceable.
Though law will continue having a critical role in watching over and protecting copyrighted works and settling disputes, blockchain-based copyrighting processes can certainly arrest copyright breaches through effecting multi-territorial licensing policies and enhanced legal certainty for artists, writers, creators and customers. At the same time, the PoE and hashing elements promise to provide a viable and efficient dispute resolution mechanism – especially those related to licensing terms; fee & tariffs and entrustment and withdrawal of online rights for management. Blockchain has shown it can address the menace of pilferage, theft and illegal use of digital content in the age of the internet, and at the same time, balance the interests of the original creators, buyers and other parties in the channel.
The US $15 trillion global supply chain industry can just be in for happier times, with blockchain promising to speed up transactions, tracking and improving a host of other processes that cause losses and wastages. Blockchain based technologies can connect up the producers, retailers, distributors, transporters, suppliers and customers in an optimal way, and improve significantly the processes of managing contracts, payments, labelling, sealing and shipping, while reducing the impact of the counterfeit and fraud.
Blockchain-based applications promise to provide a foolproof infrastructure for registering, certifying and tracking affordably and securely, the products moving between two unconnected parties on a supply chain, and who may not trust each other yet. The blockchain-based system efficiently verifies and time-stamps all tracks of the moving goods in an encrypted but transparent process. Add the fact that Smart contracts already exist to help manage payments.