An Overview of Smart Contract and Use Cases in Blockchain Technology

In the last decade blockchain technology become mainstream research topic because of its decentralized, peer to peer transaction, distributed consensus, and anonymity properties. The blockchain technology overshadows regulatory problem and technical challenges. A smart contract is a set of programs which are self-verifying, self-executing and tamper resistant. Smart contract with the integration of blockchain technology capable of doing a task in real time with low cost and provide a greater degree of security. This paper firstly, explains the various components and working principle of smart contract. Secondly, identify and analyse the various use cases of smart contract along with the advantage of using smart contract in blockchain application. Lastly, the paper concludes with challenges lie in implementing smart contract the future real-life scenario.

I. Introduction

In the year 2008, Satoshi Nakamoto explain peer to peer cash transaction without the centralized system [1]. Till date 1639 different cryptocurrency available in the digital currency market. The growth of cryptocurrency is changing rapidly. Bitcoin being the first as well the mostly capture market share [2]. Blockchain technology concept derived from initial Bitcoin transaction system. A blockchain is a digital ledger which store transaction publicly after verifies the transaction by nodes. The basic structure of the blockchain technology is shown in this figure [1]. Each transaction is validated by the nodes and transactions are secured by cryptography hash function. A transaction is link by their previous transaction hash value. Once transaction added to the blockchain no one can modify or alter it, but that transaction can be view openly which bring transparency to the system. Blockchain uses some of the proof of concept and proof of work as well as proof of stake concept to validate the transaction.