Smart contracts form the core of Web3 applications. Contracts mediate the transfer of cryptocurrency, making them irresistible targets for hackers. We introduce ASP, a system aimed at easing the construction of provably secure contracts. The Asp system consists of three closely-linked components: a programming language, a defensive compiler, and a proof checker. The language semantics guarantee that Asp contracts are free of commonly exploited vulnerabilities such as arithmetic overflow and reentrancy. The defensive compiler enforces the semantics and translates Asp to Solidity, the most popular contract language. Deductive proofs establish functional correctness and freedom from critical vulnerabilities such as unauthorized access.
The question of which law applies to digital assets is one of the thorniest problems of modern private international law. This contribution discusses the proper characterisation of digital assets and transfers, as well as the most appropriate connecting factor to link them to a governing state law. It concludes that the bulk of legal issues may be solved using traditional conflicts rules, without the need to localise the blockchain or the assets registered on it. The most difficult questions surround the law of property, which seemingly requires the localisation of the assets themselves. Instead, this contribution suggests following a waterfall of connecting factors that are independent of such localisation. Finally, it also addresses the law governing smart contracts, including DAOs and NFTs.
Blockchain is an emerging technology with great potential to provide new opportunities for industry thanks to its distributed, persistent and immutable nature. It enables the interaction of industrial systems without the need for a central authority, operating cooperatively through nodes in the network. This technology ensures the security and veracity of interactions (transactions), maximising resilience against cyber-attacks.
This paper examines the tension between code-based execution and legal enforceability in smart contracts used by cryptocurrency exchanges. As decentralized finance grows in prominence, there is an increasing need to balance the immutability and automation of blockchain-based agreements with traditional legal protections and dispute resolution mechanisms. We analyze current approaches to liability allocation and conflict resolution in major crypto exchanges, identifying key challenges in harmonizing algorithmic governance with existing contract law. Case studies of recent exchange hacks and failures are used to illustrate the limitations of purely code-based systems. We then propose a hybrid model that preserves the efficiency of automated execution while incorporating safeguards for human intervention in exceptional circumstances. This framework aims to enhance user protections, regulatory compliance, and overall trust in decentralized financial infrastructure. Our findings have implications for exchange operators, regulators, and contract law as it evolves to address blockchain-enabled agreements.
Smart contracts are self-executing agreements stored on the blockchain, widely used in finance, supply chain, IoT, and other fields. However, vulnerabilities in smart contract code can be exploited, leading to irreparable losses. Numerous smart contract vulnerability detection tools have been developed, with Slither being a prominent open-source static analysis tool. Despite its strengths, Slither suffers from false positives and false negatives. This paper introduces the SLLM system (Synergy of Slither and Large Language Models), which combines Slither with large language models (LLMs) like GPT-4. By leveraging pseudocode conversion and result feedback enhancement mechanisms, the system improves the accuracy of vulnerability detection. Experimental results show that SLLM outperforms Slither in reducing both false positives and false negatives across various common vulnerability types, demonstrating the effectiveness of integrating LLMs in smart contract static analysis.
Focusing on smart contracts, this chapter provides technical insights into their functionality and application within the travel industry. It discusses the regulatory and legal considerations necessary for deploying smart contracts in tourism, alongside the security challenges that must be addressed. This section highlights the potential of smart contracts to automate various travel-related processes, thereby increasing efficiency and reducing costs. Additionally, it emphasizes the importance of ensuring legal and regulatory compliance to maximize the benefits of smart contracts in the tourism sector. By exploring these aspects, the chapter prepares readers to understand how smart contracts can revolutionize the travel industry by streamlining operations and enhancing overall efficiency.
Letter of Credit has been used in international transfer of money by exporters and importers for a long time. Thus, it is a very niche and important area in the international trade and banking. Within the scope of this study, 220 publications in the Web of Science database has been reached by using “letter of credit” keywords. There is only one bibliometric analysis on Islamic L/C in the literature but a wider overview is required to gain general perspective about L/C. This is where the originality of this research lies. Bibliometric analysis with VOSviewer and Tableau for these publications covering 1980-2024 has been conducted about citations, organizations, keywords, publication years, sources, fields and countries. As a result; almost half of the publications produced in USA, “Byrne James e” is the most productive author, “Journal of International Economics” is the most cited journal, USA is also leading country in terms of citation, and “Natl. Chung Hsing Univ.” is the leading organization in terms of citation. Moreover, co-occurrence analysis on keywords show that digitalization has huge effect on L/C literature. Keywords like “blockchain”, “smart contracts”, “ethereum”, “BPO” etc. emerged as new trend in the last decade.
Smart contracts are pivotal in blockchain systems, yet ensuring their reliability and security remains challenging due to coding complexities and potential vulnerabilities. This paper explores the use of Large Language Models (LLMs) in enhancing the smart contract code quality. As part of leveraging extensive training data and language understanding, we experiment with different approaches. LLMs aid developers by offering automated code suggestions, identifying vulnerabilities and promoting best practices. Through experimentation, we demonstrate how integrating LLM-based approaches improves code quality and reliability in blockchain applications.
Our understanding of contracts continues to evolve. Electronic contracts that have typically taken the form of shrink-wrap, click-wrap, web-wrap, scroll-wrap, multi-wrap and sign-in-wrap agreements have undergone further developments with the introduction of automation in electronic contractual engagements and, more recently, the advent of the so-called "smart contract". Different types of smart contracts exist, including smart contracts that operate on blockchain technology. Despite these developments in commercial and contractual activities, the South African legal framework does not officially recognise smart contracts. The use of the Electronic Communications and Transactions Act, 2002 (ECTA) as a mechanism for the regulatory oversight of smart contracts in South Africa is, in its current form, woefully inadequate and limited in its application to smart contracts. Other jurisdictions, like the European Union (EU), have passed draft legislative and regulatory documentation called the Data Act to address smart contracts, whilst the UK Law Commission has provided recommendations to regulate smart contracts. As South Africa currently has no equivalent to the EU's draft Data Act and has not considered the operation of smart contracts in South Africa, the position in the EU and United Kingdom (UK) is considered in this paper to provide guidelines as to the aspects that it would be necessary to regulate in a South African context.
O trabalho objetiva analisar a figura dos smart contracts na perspectiva do princípio da obrigatoriedade dos contratos, de maneira que possa ser determinada uma potencial ressignificação do “pacta sunt servanda” diante deles. Assim, busca conceituar e categorizar a blockchain e os contratos inteligentes para um exame de seus efeitos diante do Direito e o modelo do contrato tradicional. Por conseguinte, é realizada uma breve contextualização histórica da força obrigatória dos contratos, apontando suas concepções na história, analisando-o no contexto do meio digital. Considerando-se essa análise, são sistematizadas suas aplicabilidades em nível global e, posteriormente, na realidade brasileira – de modo a apresentar as possíveis vantagens e desvantagens do instituto. Adota-se na pesquisa a metodologia referencial bibliográfica, utilizando artigos, livros e obras que se reportam ao tema, assim como a legislação brasileira. Diante da pesquisa, conclui-se que o smart contract é uma opção com capacidade de reduzir os custos de transação e alguns riscos inerentes às operações. No entanto, devido às limitações da lógica de programação, seria uma opção viável para contratos mais simples e nichos específicos. Ademais, pode ser vantajoso aos entes públicos, no âmbito de sua própria rede Blockchain e, ainda, em face à possível utilização da moeda digital.
R.M.O.H. Bandara, M.D.T.E. Abeynayake, I.E. Illeperuma, B.A.I. Eranga
Disputes frequently arise in construction projects due to the complexity of the processes and challenging environment, resulting in cost overruns, delays, wastage, and low productivity. Thus, the Construction Industry (CI) is enthusiastic about innovative dispute mitigation measures by incorporating digital technologies. Consequently, Smart Contracts (SCs) have emerged as a pioneering approach to digitise construction contracts and thereby mitigate construction disputes. Accordingly, this research aims to investigate the applications of SCs to mitigate disputes in the Sri Lankan CI. The research aim was approached through an explanatory mixed method. Initially, a questionnaire survey was carried out to collect quantitative data which was followed by qualitative expert interviews. Quantitative data were statistically analysed through Mean Weighted Average (MWA) and Relative Importance Index (RII) whereas qualitative data were analysed through content analysis. The study identified the root causes of construction disputes in the Sri Lankan context as poorly written contracts, poor preparation and approval of drawings, lack of communication and coordination, poor supervision and site management, and contain of contradictory and inaccurate information in the contract documents. The findings highlighted that SCs can significantly reduce construction disputes by replacing ambiguous processes with clear, automated processes. By linking payments to milestones, storing project data transparently, and potentially triggering actions based on safety or quality data, SCs streamline communication, ensure everyone plays by the agreed-upon rules, and thereby minimise disputes. Future researchers are suggested to explore the practical challenges and strategies for implementing SCs in the Sri Lankan CI.
Maruf Ahmed Mridul, Kaiyang Chang, Aparna Gupta, Oshani Seneviratne
The global financial landscape is experiencing significant transformation driven by technological advancements and evolving market dynamics. Moreover, blockchain technology has become a pivotal platform with widespread applications, especially in finance. Cross-border payments have emerged as a key area of interest, with blockchain offering inherent benefits such as enhanced security, transparency, and efficiency compared to traditional banking systems. This paper presents a novel framework leveraging blockchain technology and smart contracts to emulate cross-border payments, ensuring interoperability and compliance with international standards such as ISO20022. Key contributions of this paper include a novel prototype framework for implementing smart contracts and web clients for streamlined transactions and a mechanism to translate ISO20022 standard messages. Our framework can provide a practical solution for secure, efficient, and transparent cross-border transactions, contributing to the ongoing evolution of global finance and the emerging landscape of decentralized finance.
El uso del comercio electrónico para celebrar relaciones de consumo cada vez toma más protagonismo en la sociedad de la información. El constante desarrollo de las tecnologías hace que las plataformas existentes puedan beneficiarse de sus características; sin embargo, también traen consigo diferentes cuestiones jurídicas que deben mitigarse a fin de proteger los intereses y derechos de los usuarios. La tecnología blockchain es una de las tecnologías que viene a revolucionar el ámbito de las relaciones electrónicas B2C gracias a su carácter transnacional, descentralización, garantía de confianza, inmutabilidad y a una de sus funcionalidades más características: los smart contracts. Este tipo de acuerdos se distinguen por su automatización y autoejecución, caracteres que a priori pueden poner en riesgo la legislación existente sobre consumidores y usuarios. Asimismo, las oportunidades que brinda blockchain de cara a que los usuarios puedan actuar de forma irreconocible puede poner en jaque la normativa encargada de determinar la competencia judicial internacional y la ley aplicable a las relaciones jurídicas de consumo B2C. Este trabajo analiza la aplicabilidad de los smart contracts en el ámbito del comercio electrónico, en especial en el de empresas con consumidores (B2C) y estudiar los posibles inconvenientes que generan sobre la normativa existente a fin de analizar si es necesario adaptar la legislación a estas tecnologías.
Abstract Contract automation is a challenging topic within Artificial Intelligence and LegalTech. From digitised contracts via smart contracts, we are heading towards Intelligent Contracts ( iContracts ). We will address the main challenge of iContracts: the handling of communications and risk data in contract automation. Our Research Question reads: to what extent is it possible to develop an ontology that automates contracts with communications and risk data? The article designs and conceptualises an iContract ontology. Our findings validate the conceptual expressiveness of our ontology. A brief discussion highlights the value of the ontology design and its application domains. From the results, we may conclude that the current method is innovative and that further research is necessary for handling more complex use cases.
NatSpec comments play an essential role in smart contracts. Their clear and informative format helps users gain an accurate understanding of smart contract functions and diminish financial risk. However, widespread non-adherence to NatSpec standards currently causes confusion for both end-users and developers. Current research often neglects the importance of NatSpec formats or solely emphasizes user-centric comments in smart contract generation. This oversight can hinder contract trustworthiness, code reusability, maintenance efficiency, and ultimately, the development of the community ecosystem. To bridge this gap, this paper presents the first empirical study on 253 verified contracts encompassing 16,620 functions from Etherscan, uncovering that 87 % of the smart contract functions have Comment Errors (CE) and pinpointing prevalent deviation patterns. Based on our findings, we propose CETerminator, an automated approach for detecting and rectifying CE in smart contract functions. Due to the scarcity of NatSpec-compliant comments for collected smart contract functions, CETerminator employs in-context learning on a large language model to generate NatSpec comments. The approach then compares the original and the generated comments, utilizing corpus-driven heuristic rules to identify and correct diverse error categories in the original comments. In our evaluation, CETerminator demonstrates a high token overlap rate for addressing missing comments. In addition, the average precision, recall, and F1-scores for handling inconsistency comments are 85.28 %, 86.48 %, and 85.85%, respectively, outperforming the baseline by 39.79%, 39.53%, and 39.84%.
Les smarts contracts , programmes informatiques s’exécutant automatiquement lorsque des conditions préprogrammées sont remplies, vont impacter le processus contractuel, en particulier lorsque leur développement portera sur la phase de formation du contrat. Le recours à des oracles numériques, chargés de transmettre les informations du monde réel au monde virtuel, pour déclencher l’application du smart contract risque de dégrader la qualité du consentement, pour y substituer un simple assentiment.
Smart contracts are autonomous and immutable pieces of code that are deployed on blockchain networks and run by miners. They were first introduced by Ethereum in 2014 and have since been used for various applications such as security tokens, voting, gambling, non-fungible tokens, self-sovereign identities, stock taking, decentralized finances, decentralized exchanges, and atomic swaps. Since smart contracts are immutable, their bugs cannot be fixed, which may lead to significant monetary losses. While many researchers have focused on testing smart contracts, our recent work has highlighted a gap between test adequacy and test data generation, despite numerous efforts in both fields. Our framework, Griffin, tackles this deficiency by employing a targeted symbolic execution technique for generating test data. This tool can be used in diverse applications, such as killing the survived mutants in mutation testing, validating static analysis alarms, creating counter-examples for safety conditions, and reaching manually selected lines of code. This paper discusses how smart contracts differ from legacy software in targeted symbolic execution and how these differences can affect the tool structure, leading us to propose an enhanced version of the control-flow graph for Solidity smart contracts called CFG+. We also discuss how Griffin can utilize custom heuristics to explore the program space and find the test data that reaches a target line while considering a safety condition in a reasonable execution time. We conducted experiments involving an extensive set of smart contracts, target lines, and safety conditions based on real-world faults and test suites from related tools. The results of our evaluation demonstrate that Griffin can effectively identify the required test data within a reasonable timeframe.
Smart contracts are frequently vulnerable to control-flow attacks based on confused deputies, reentrancy, and incorrect error handling. These attacks exploit the complexity of interactions among multiple possibly unknown contracts. Existing best practices to prevent vulnerabilities rely on code patterns and heuristics that produce both false positives and false negatives. Even with extensive audits and heuristic tools, new vulnerabilities continue to arise, routinely costing tens of millions of dollars. We introduce SCIF, a language for secure smart contracts, that addresses these classes of control-flow attacks. By extending secure information flow mechanisms in a principled way, SCIF enforces both classic end-to-end information flow security and new security restrictions on control flow, even when SCIF contracts interact with malicious non-SCIF code. SCIF is implemented as a compiler to Solidity. We show how SCIF can secure contracts with minimal overhead through case studies of applications with intricate security reasoning and a large corpus of insecure code.
Muhammad Izzul Syahmi Zulkepli, Nur Bakri Abd Hamid, Hazrul Hizam Karim, Mohammad Taqiuddin Mohamad
The rapid development in technology, especially smart contract technology, poses challenges in aligning its principles with the Shariah perspective. Although this technology has great potential to facilitate human affairs in various fields, including the financial, zakat and halal sectors, the gap between Shariah researchers and the understanding of this technological innovation is wide due to the complexity of smart contracts involving technical aspects and new innovations. Therefore, the purpose of this study is to explore the challenges in understanding smart contract technology from the perspective of Islamic law. A qualitative approach based on library research was applied to achieve the objectives of the study by referring to relevant documents and literature. The collected data was then analyzed using thematic content analysis methods, enabling the identification of themes and patterns in the literature related to smart contracts and Shariah principles. The results found that there is a significant gap in the understanding of smart contracts among Shariah researchers, mainly due to the technical complexities involved and limited accessibility to relevant information. To address the knowledge gap, it is important to increase access to comprehensive resources that describe the technical aspects of smart contracts along with Shariah principles. Collaboration between technologists and Shariah scholars are important to facilitate mutual understanding and bridge the gap between the two domains. Additionally, ongoing research and discourse is encouraged to refine the understanding of smart contracts within the Shariah framework.
Emerging technologies play pivotal role to accelerate the application of various developing sectors of the world. Automation and digitalization coupled with blazing fast networking have the potential to automate the execution of civil law. More precisely, smart execution and enforcement of contracts. With this notion in mind, this short article elaborates on the technical attributes of smart contracts and the technology that empowers it, the “Blockchain” and Distributed Ledger Technology or DLT. Moreover, the author of this article strived to emphasize the need for regulatory compliance of this evolving technology with reference to the adoption of smart contracts in various jurisdictions. Finally, the goal of this article is to extrapolate the exigencies of smart contract and how it can revolutionize the traditional contract law with automation and efficiency.
Bo Gao, Qingsong Wei, Yong Liu, Rick Siow Mong Goh
Smart contracts are becoming an integral part of decentralized applications, yet exploitable bugs in these contracts pose significant threats, often leading to considerable monetary losses. Traditional tools often struggle to identify these bugs, with a recent study indicating that 80% of them are classified as Machine Unauditable Bugs (MUBs), rendering conventional approaches ineffective in addressing such cases. In practice, identifying MUBs requires seasoned expertise and is time-intensive, often stalling project progress. In this work, we present a preliminary evaluation of the performance of ChatGPT, a state-of-the-art large language model, especially in detecting MUBs. Our study first investigates the effectiveness and limitations of ChatGPT in detecting various categories of MUBs with two kinds of prompts, general prompts and guidance prompts, on 246 real-world MUBs collected from Code4rena between 2021 and 2022. Subsequently, we compared the leading tool, SPCON, with ChatGPT on 17 CVE contracts with access control issues (a category of MUBs), and found that ChatGPT exhibited comparable performance but better usability over SPCON. We summarize the implications of our findings for the broader community, shedding light on the model’s capabilities, limitations and potentials in detecting smart contract bugs. Our evaluation dataset and results are released at Github1.
Arvind Kumar, Gunjan Bhatnagar, Megha Mishra, D. C. Sangwan · 6 authors
Smart Contracts are designed to facilitate the alternative of digital goods and offerings with minimum transaction charges, counting on self-executing code to ensure that each contractual term is followed. This era has enormous potential to revolutionize business relationships. However, it has yet to benefit from regulatory popularity in many jurisdictions. To ensure that intelligent Contracts can function in a compliant way, comprehensive legal frameworks should be advanced and included to define liabilities, establish enforcement procedures, and defend the parties’ rights. A sizable task in this manner is that clever Contracts aren’t necessarily sure by the prison framework of a specific jurisdiction and may be concerned with exclusive legal guidelines relying on the parties’ agreement and the geographic places of the events. As such, felony frameworks should be transportable throughout jurisdictions to ensure a steady and harmonized regulatory panorama. In addition, studies are needed to explore how current felony fashions and agreement law can be adapted to govern clever Contracts and to perceive how the monetary transformation delivered by using this technology may enhance social value and create equitable consequences for all stakeholders.
This chapter discusses how blockchain and smart contract technologies have the potential to revolutionize the intellectual property (IP) domain, especially in copyright. By tokenizing works, ownership metadata, licensing terms, and remuneration, these technologies can automate and standardize a multitude of IP-related transactions. Smart contracts can authorize the use and exploitation of copyright-protected content and ensure proper remuneration. Furthermore, blockchain technology can help businesses manage copyright registration requirements more efficiently, reduce administrative burdens, and costs, and enable direct payments and cross-border transactions. These benefits can drive inclusivity and expand access to formal IP services, especially for micro, small, and medium-sized businesses. Platforms like Blockpool and the Mycelia Project are already using blockchain and smart contracts to create more inclusive financial ecosystems for creators, helping them reach new audiences, enter partnerships, and receive direct payments. As the finance world evolves, blockchain and smart contract technologies offer durability and flexibility for businesses of all sizes.