The most common and at this point the most useful application of blockchain is for smart contracts. An industry is growing around this application, including Ethereum, Eos and Tazius, among others.
Smart contracts are designed to automatically implement contracts that involve some routine procedure that can be programmed. Program code is developed and entered into the blockchain for processing. Once an implementation is initiated, it cannot be changed; all blockchain based contracts are immutable. Code can contain errors, so proper development techniques are crucial.
Smart contracts are encrypted and so the encryption keys pose a risk. They need to be fully protected. Most attacks on blockchain contracts so far have involved attacks on the keys.
Setup is therefore critical for smart contracts, and must often involve legal reviews and audit reviews before they are executed.
Some commentators have given a false impression that blockchain contracts are free of risks and do not require any reviews or such procedures. Because of the need for accurate code, strong encryption keys and effective access control, this is simply untrue.
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