Finance glossary
Smart Contract
Definition
Self-executing code that runs automatically when conditions are met.
A smart contract is a program stored on a blockchain that executes automatically when predefined conditions are satisfied, without intermediaries. It enables trustless agreements and underpins DeFi, NFTs, and DAOs, though bugs in the code can be costly and irreversible.
In a sentence
The loan released funds automatically once the smart contract confirmed the collateral was deposited.
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