FROM PAPER CONTRACTS TO SMART CONTRACTS

Abstract

In today's technological world, a large number of different types of agreements are made and electronic data interchange (Electronic Data Interchange - EDI) is an information exchange communication technology and is an alternative to paper-based communication. While the contract is drawn up for the parties involved in the transaction, the information in the "fine print" is provided, the transaction is developed, the software and the confirmation of the transaction make the user partially accessible to the information that may be valuable or confidential to him. Actions carried out through the software can in some cases be potentially dangerous, these reasons can be: improper protection of information, the possibility of evading sanctions due to the interpretation and non-fulfillment of the agreement made by the parties. Electronic means of payment leave some electronic traces and may become available to the interested party. Most consumers do not know if their names are associated with their purchases in databases, and significant portions of these transactions may be subject to processing and, more importantly, making the information public. Therefore, great importance is attached to data security and anonymity. This approach is offered by the decentralized environment-blockchain technology and the smart-contract computer transaction protocol integrated into it. Smart contracts are the basis of the Decentralized Finance (DeFi) industry, and because they do not require the involvement of third parties, they become a very cheap, desirable, fast and flexible system. In the NFT industry, they are trying their best to implement smart contracts in projects. Parties can rely on tamper-proof technology that controls the actions of the smart contract code so that processes are carried out automatically; This is how the contract code is practically enforced. This form of practical enforcement is achieved when all necessary actions are fully implemented in a computer program or technological environment.