Smart Contract

A smart contract is computer code executed on a blockchain.

Instead of running on a computer, the program will run on the blockchain, using the computing power of the blockchain’s nodes, in exchange for a fee.

“Smart contract” is a very broad term. It can designate a simple wager between two individuals with a simple condition (the result of a soccer game) as well as a complex DeFi protocol.

Not all blockchains allow for smart contracts. The Bitcoin blockchain cannot run smart contracts. Ethereum is the most famous example, as well as the blockchains that uses the EVM (Ethereum Virtual Machine) standard such as the Binance Smart Chain.

Unlike what the name states, smart contracts are not contracts. They are purely computer programs such as algorithms or software.