The combination of smart contracts with blockchain technology has given the world a new perspective of how people can make their life better.
That’s because the concept of smart contracts can be applied to a broad range of business sectors, from finance to law.
In Market Cap Cryptocurrency we found and represent some of the hottest industries that can adopt smart contracts.
Those industries are listed below:
- Finance and Banking
- Insurance
- Internet of Things
- NFTs
- Real Estate
- Law industry
So, let’s waste no time and dive deeper into the broad variety of where smart contracts can be used.
Smart contracts in banking and finance
Smart contracts have the potential to greatly improve the efficiency in the financial industry by automating processes and increasing transparency. Below you can see some examples of how smart contracts are being used in finance.
Trade finance
One great usage of smart contracts would be to automate the process of trade finance, which involves the financing of international trade transactions.
Derivatives
Furthermore, smart contracts can be utilized to automate the execution of derivatives contracts, which are financial instruments used to hedge against the risk of price movements in underlying assets.
Loans
The process of loans can change for the better since smart contracts can be used to automate the process of lending and borrowing.
Payment processing
The process of payment processing can become fully automated by smart contracts, such as the settlement of transactions and the transfer of funds.
Smart contracts in insurance
Let’s continue with one more suitable field that can bring amazing changes. The following are some examples of smart contracts in insurance market
Claims handling
The process of claims handling can be done automatically, such as the assessment and payment of claims.
Underwriting
Smart contracts can be applied to computerize the process of underwriting, which involves the evaluation of risk and the setting of premiums.
Reinsurance
Additionally reinsurance can use their help. For example, a smart contract could transfer risk from one insurer to another.
Policy issuance
The final example of smart contracts in the insurance market is that it can automate the issuance of insurance policies.
Internet of things
This combination is among the most innovative since both smart contracts and IoT technology haven’t yet reached their final form. Anyway the most suitable examples of smart contracts in IoT are listed below.
Supply chain management
Supply chain management can use those contracts to track the movement and the condition of goods anytime and ensure that all parties involved in a supply chain are meeting their contractual obligations.
The process of managing and updating devices in the environment of the Internet of Things can be very easily automated with the use of blockchain technology and smart contracts.
Service level agreements
A smart contract based architecture that provides for SLA management among relevant entities and actors in a decentralized computing environment.
NFTs
In general, smart contracts have played a key role in the development of the Non Fungible Tokens (NFT) market and have the potential to greatly improve the efficiency and transparency of NFT transactions.
Art marketplaces
These kinds of contracts can be used in virtual art galleries to buy and sell, track ownership and distribute digital art.
Digital game assets
Smart contracts will provide the ability to gamers to create, store and exchange NFTs or something else valuable inside a virtual game. In the case of transferring NFTs through a virtual game, smart contracts are the only way to do it due to the decentralized nature of the digital games.
Intellectual property
Licensing and royalty payments for intellectual property, such as music, literature, and software are also going to be automated.
Certificates of authenticity
That is the main reason why smart contracts NFTs go hand in hand with smart contracts. And that reason is of course to automate the issuance of certificates of authenticity for physical items, such as art or collectibles.
Real Estate
Another business industry that smart contracts can be a very good fit is the real estate field. Smart contracts can be very helpful in many aspects of real estate, from renting contracts to buying and selling.
Law industry
Last but not least, smart contracts have the potential to revolutionize the law industry. That industry has intentionally left last because it is the one that is going to completely be reshaped by the use of smart contracts.
There is already a lot of talking whether blockchain technology and smart contracts will eventually replace lawyers.
Some experts argue that soft law occasions are going to become automated and only complicated situations are going into the court.
More specifically the following areas are expected to feel more the impact of the blockchain revolution.
Dispute resolution
Smart contracts can be used to automate the process of dispute resolution, such as through the use of smart contract clauses that allow for the automatic execution of arbitration agreements.
Compliance
Another example of smart contract is the automation of the process of compliance with laws and regulations.
Legal research
Smart contracts will be used to automate the process of legal research, such as by providing access to a database of legal precedents.
What are the best examples of smart contracts?
In conclusion, smart contracts have the potential to revolutionize a wide range of industries by automating processes and increasing transparency. By utilizing the capabilities of blockchain technology, smart contracts can bring about significant improvements in efficiency and security in industries from finance and real estate to the legal industry.
Image Source; ByBit
