Cardano Smart Contracts
We will describe what problems smart contracts solve and why we need them. Then we will explain how they work. We will talk about Cardano smart contract languages Plutus and Marlowe.
Smart contracts idea is probably older than you think. Smart contracts were first proposed by Nick Szabo, who coined the term in 1994. You can check his original work:
What is a contract
First of all, let’s have a look at the dictionary definition of a contract:
“A written or spoken agreement, especially one concerning employment, sales, or tenancy, that is intended to be enforceable by law.”
A contract is an agreement between two parties that mutually agreed to behave or act as the contract states. The contract usually has to have a specific form (date, conditions, names, signatures) and if any party does not agree with the acting or not acting of the other party then the law has to get engaged to solve the issue.
The issue is that in the real world a paper contract cannot enforce the correct or honest behavior of the participants. There must be a third party that solves all possible issues. Thus there are so-called legally binding…
