Smart Contracts

Smart Contracts and Contractual Obligation


The original idea is a series of clauses could be incorporated into the hardware and software, Szabo proposed the introduction of contracts from property rights of digital stuff. The author suggested the use of cryptographic techniques and electronic signatures make secure, traceable transactions.

When’re using smart contract term you usually refers to two many conceptual categories:
1. The first point it’s referred to the operational aspects, in particular agent. In this case, the word is used in relation to the ability that these agents have to automatically perform some actions related to obligations and rights on a good shared on a shared register.
2. The second category refers to how smart contracts could be expressed and implemented through software. This involves analyzing how it can be interpreted.
Today the interpretation that we put upon Blockchain it’s the synthesis of two categories described before, working on automatized contracts executable by pc, but crepitated anyway.

Today it’s so difficult to show smart contract as legal paper to the court, it’s different show contract with a friendly language, not developer language. The difficult thing it’s the judge’s interpretation in court seat. The searching tools that could help to draw up an interpretation started in 1956.

Today we have different kinds of stuff that are focused on the formalization of the juridic language for automatic informatics interpretation (CommonAccord, Legalese, Monax’s Dual Integration ).

Smart Contracts between software codec and law:
After the analysis of the contract, we’ve to analyze the typical contract structure first. The written agreements a) those relating to the operational aspects, that is to say specific actions that the parties must put an execution in place of the contract; b) those relating to non-operational aspects whose automation isn’t particularly relevant.

In linguistic terms, the semantic non-operative aspects could be very complex, while the first type aspect appears more easily translated into a programming language.
In contract context there are clauses that specify parties obbligations and the actions that they undertake; the first part regulates the rules to be applied, the second part defines the applicable law and the competent court.
Also, there are accessory elements, such as the conditions and terms, as well as a series of definitive clauses regarding how certain terms included in the agreement must be understood.

By the increasing the parameters complexity, it would be possible to bring the intentions of the parts black to an executable-machine language, in order to make them executable automatically.

Parameters could be considered as ‘’primitive data’’ others may be more complex, such as a list, until they can contain true expressions intended as functions. The parameter could also refer to an external element, enhanced by data received from an oracle.
In particular, constructing clauses through the definition of parameters can appear simple for those predictions that relate to events or numerically certain elements, but certainly not it can be considered a resolutive methodology for the complex content of a contract.

The hypothesis is suggestive, but the writer seems to be difficult to implement in the short term. If one only keeps in mind the complexity of the legal system, the specificities of one system over another and the experiences and attempts at the standardization even within a single context.

Smart contract and civil law:
At present, if we want to try classifications we can consider that a smart contract:

1. It can access a wider contract with which the parties reach an agreement outside the blockchain and decide to formalize all of part of the executive phases by drawing up a smart contract. In this case, the smart contract is an accessory to a wider agreement;
2. It can regulate all agreements between the parties, exhausting the relationship in the execution of planned actions. This smart contract contains the entire regulation of the relationship between the parties and guarantees its execution;
3. It can provide obligations for a single part, that formalizes them in a smart contract that will perform the services when certain conditions arrive.

The smart contract contains the discipline of the services that the actor undertakes to carry out when certain events occur. For the example, smart contracts provide for the transfer of digital assets upon the occurrence of a specific condition, such as the receipt of a cryptocurrency.

From the above analysis, it’s clear that at the present there is still a long way to go to achieve standardization and typing of smart contract

Giorgio Chiriatti

Smart Contracts
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