If you have ever used a vending machine at the airport, you should know how Smart Contracts work. And while a vending machine is more of a primitive ancestor, the elementary concept is still the same, i.e., middlemen elimination.
- Smart contracts make Blockchain programmable
- With Smart Contracts, developers can create on-chain dApps
- DeFi, NFTs, DAOs, real-estate dealings, and other decentralized activities have Smart Contract innovation behind them
- Ethereum is the mother of all Smart Contract projects but marred by high gas fees and sluggish transaction speeds
- Read on to know four new projects and their native tokens that we have listed, taking smart contract functionality to a different level altogether
Smart Contracts are meticulously codified programs residing on blockchains. And they run only when some pre-defined conditions are fulfilled.
And while there are many different ways of explaining what a Smart Contract is, it can always be singled out as a self-executing block of code that is immutable and distributed.
Fact Check: Being immutable means a Smart Contract, once created, cannot be changed or tweaked. If you want to stop it from being executed, you must create another Smart Contract to automate the same.
But this discussion isn’t about Smart Contracts and their functioning. This topic talks at length about the top crypto projects in 2022 that have taken the concept and relevance of Smart Contracts to a new level altogether.
However, if you are still unsure about how Smart Contracts work, here is a detailed explainer to help you grasp everything of importance.
Coming back to the matter at hand, Smart Contracts, in 2022, are less about the concept and more about the implementation and real-world use cases. And that is exactly what we are going to talk about in the subsequent sections.
Smart Contracts in 2022: Possibilities Galore
Code is still the law when it comes to Smart Contracts. While in 2021, we explored the common use cases like Buyer-Seller arrangements, automated insurance claim settlements, transparent voting, functioning of DAOs, and more, 2022 seems to be hinged towards projects supporting Smart Contracts and their extrapolations.
Also, in the current year, Smart Contracts are mostly being considered for creating top-shelf DeFi products and pushing NFTs at scale. And while this brings us to independent Blockchain projects like Algorand, Elrond, and Tezos, we shall skip these popular chains altogether.
In the subsequent sections, we shall talk about five crypto projects hogging all the limelight in 2022 when Smart Contract implementations are concerned. And yes, it goes well beyond DeFi and NFTs:
Ethereum (ETH)- The Mother of All Smart Contract Projects
- Supports dApps
- Supports DAOs
- Smart Contracts are developed using the EVM (Ethereum Virtual Machine) architecture.
- Second largest crypto ecosystem, according to market capitalization
- Currently supports Proof-of-Work
- Average block mining time of 15 seconds
Well, you cannot proceed with any Smart Contract discussion without accommodating Ethereum. Despite the higher gas/transaction fees and questionable scalability, the existing Ethereum blockchain is replete with numerous Smart Contracts.
Smart Contracts relevant to the Ethereum ecosystem are primarily written in Solidity and Vyper.
Fact Check: Solidity and Vyper are standard Smart Contract programming languages.
And considering the exhaustive set of options on offer, Ethereum-backed Smart Contracts can be used for powering multi-sig accounts, real-world agreements, and even storage. Smart contracts relevant to Ethereum Blockchain can be used to build decentralized applications, which can then have several practical applications.
But that’s not why Ethereum Smart Contracts are being discussed right now. In 2022, Ethereum-powered Smart Contracts will majorly drive interoperability, cross-chain interactions, stablecoin-creation, and application development. Once ETH 2.0 comes into existence, companies planning to move on-chain will not have to worry about transaction delays and high fees.
Harmony (ONE): More like a Beta Version of ETH 2.0
- Energy-efficient via Proof-of-Stake consensus mechanism
- Supports Sharding (partitioning blocks to speed up transactions and lower latency)
- No forking
- The native token serves multiple utilities
ETH 2.0 aims to increase transaction throughput, lower fees, and even lower transaction finality. But there is a catch! It isn’t here yet.
However, by the time ETH 2.0 shows up, you can make do with Harmony, a next-gen Smart Contract project that relies on building use-case-specific dApps. The fun part about Harmony is that it supports bridging for achieving ‘Cross-Chain’ interoperability.
Fact Check: Interoperability across chains means Harmony can be used to transfer tokens information and initiate transactions from one Blockchain to the other, making the entire ecosystem more inclusive.
Interoperability is driven by relevant dApps that have Smart Contract at the core. And the meticulous implementation of Smart Contracts and Proof-of-Stake consensus mechanism ensures insanely low transaction costs and a 2-second finality.
And suppose you are a Smart Contract geek. In that case, Harmony even comes across as an open platform that accommodates marketplaces, especially those focusing on DeFi use cases, NFTs, governance, real-estate, and more.
ONE, the native Harmony token, aims at incentivizing these smart contract initiations, applicable across the mentioned use cases like DeFi staking, fee payments, and even on-chain governance geared towards decision making.
Looking to delve into the technicalities of Harmony (ONE) Blockchain! Read more here.
Fantom (FTM): DeFi-Focussed Smart Contract Platform
- DAG-based ecosystem (More like a multi-directional and faster version of Blockchain)
- Transaction finality is less than 2 seconds
- Environment-friendly crypto project
- The native token can be used for staking, rewarding, and fee collection.
While Blockchain is a great resource to have, some DAG-based projects are steadily coming up the ranks.
Fact Check: Known as Digital Acyclic Graph, DAG redefines decentralization by recording transactions on top of each other. And DAG has several perceived advantages like better transaction speeds and throughput.
Fantom is one such DAG-based project that is deemed ‘Completely Programmable’, courtesy of Smart Contract support. What separates Famtom from the rest is the presence of a more secure and EVM-compatible, bespoke Proof-of-Stake mechanism that makes Smart Contract deployment easy and straightforward.
Also, the DAG architecture makes Fantom scalable and fast. Smart Contracts relevant to the Fantom network can be used to support DeFi applications. On top of that, the native token or FTM comes in handy for paying transaction fees, voting on on-chain proposals, and staking to earn rewards.
But there is more to the Fantom blockchain than just Smart Contract support. Head over to the Fantom Spotlight for more information.
Chromia (CHR): A Place for all your dApps
- It aims at solving the scalability issues once and for all
- Features a built-in relational database
- Native token is meant for fee-payment and rewards
- Multi-chain Layer-2 ecosystem that resides on both BSC and Ethereum
Even though Ethereum offers dApp-specific support, several challenges act as pillions. Major shortcomings include slower transactions and exorbitant fees. Chromia, as a smart contract project, aims at solving these issues, once and for all, by letting the dApps scale to massive user bases.
The Chromia ecosystem is as inventive as it can get. It has a central, primary blockchain that supports side-chain-specific scalability. Every dApp can attach itself to a side-chain, thereby selecting its own incentivized payment schema.
Developers can use the Chromia blockchain to build use-case-specific decentralized applications. According to this approach, dApps can use both the base layer of Chromia or the Layer-2 or the enhancement chain that has its roots in Ethereum and BSC blockchain.
Each decentralized application gets a strong foothold in the Chromia ecosystem and can receive investments or even compensate developers using the native CHR token.
At present, the Chromia ecosystem supports real-estate, healthcare, DeFi, and gaming-related dApps and is progressively opening up to newer verticals.
Keep Network (KEEP) A Private-Public Blockchain
- The ecosystem comprises off-chain data containers
- Solves the public data conundrum
- Native tokens are used for network governance
- Private data is connected to the public Blockchain using Smart Contracts.
As a decentralized ecosystem, the Keep Network is set out to achieve the demanding task of bridging on-chain resources with off-chain data containers via smart contracts. And while public-private bridging is the main task at hand, the Keep Network can also be used to establish token-swapping bridges between competing Blockchains.
Fact Check: tBTC or tokenized-Bitcoin is the first Keep Network-specific application aimed at making Bitcoin-equivalent tokens available on the Ethereum blockchain via bridging. A certain quantity of BTC is tied to a smart contract, which then returns an equal amount of tBTC, an Ethereum token, to help you handle Ethereum-specific processes or access ETH-based dApps.
Coming back to the actual job at hand, the Keep Network connects with off-chain keep providers, who stake their KEEP or native tokens to play a role in growing the community. In return, they get rewarded in KEEP to provide storage facilities, computation, and even encryption.
The Keep Network is mighty secure as the providers run the risk of being penalized if they are negligent with the keeps or private data containers. The staked tokens are absorbed by the protocol via smart contracts, which in turn makes the network automated and more like a DAO or a Digital Autonomous Organization.
Over time Smart contracts will become indispensable with organizations and users slowly shifting towards a more decentralized, transparent, and auditable reality. With DAOs expected to become mainstream in years to come, Smart Contracts will have far deeper applications, especially when blockchains like the Keep Network are concerned.
And the possibility of agreements and contracts underpinning most daily interactions will make investors keep these above-mentioned crypto projects on the radar, along with the more mainstream ones like Ethereum, Solana, and Polkadot.
To sum it up, Smart Contracts are the future, and projects running them, either to bridge different blockchains, manage on-chain activities, or to make the dApps scalable, are slowly going to blur the lines between the real and the virtual.
If you found the Smart Contract piece interesting, read and learn more with CoinSwitch by your side.
Disclaimer : Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. The information provided in this post is not to be considered as investment/financial advice from CoinSwitch. Any action taken upon the information shall be at user's own risk.
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