A contract by any other name is still a contract. In essence, they are legal agreements between two parties.
ADLT™ can leverage “Smart Contracts” to help facilitate transactions. A “smart contract” is a piece of code that is self-executing when certain requirements are fulfilled. The range of transactions can be from executing payments for IP, trade finance, etc.
The legal standing of “Smart Contracts” is still in an early stage of development. According to an article published last month in CoinDesk, a legislator in the State of Arizona has introduced a bill to legalize Smart Contracts and Digital Signatures recorded on the Blockchain.
Another article from Thompson Reuters written in September 2016, highlighted the benefits of Smart Contracts:
- Smart contracts are coded so there is less ambiguity than prose;
- Verification can be achieved even within a trustless environment;
- Self-executing; so once released, it is difficult to impede execution; and
- Integrates well with IoT, artificial intelligence (AI) and machine learning.
However, along with that were some challenges:
- Infrastructure needs to be updated;
- Lack of experience with blockchain technology in IT departments;
- Lack of education and understanding of the technology in other departments, including compliance;
- Development of uniform standards and protocols; and (of course)
- Need to overcoming custom and tradition (, change is hard.)
Like the Blockchain itself, the concept of “Smart Contracts” is not new. Josh Stark mentioned that Nick Szabo originated the concept of a Smart Contract in 1997, where he indicated that a vending machine is the first version of a “Smart Contract.”
By combing “Smart Contracts” with ADLT™, complete trust between parties that don’t know each other can occur. But, as with all executable code, care must be taken to make sure that it works as expected and that an outside party cannot interfere and invalidate or redirect the transaction. This is why iSolve not only provides support for implementing ADLT™, but also provides guidance for developing governance models to support the entire network.
If you or any of your colleagues are interested in receiving information about ADLT™ or the Blockchain for Pharma or if you are interested in viewing our presentation and demo, contact us at email@example.com. Thanks and we look forward to hearing from you.
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