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What Smart Contract Services Can Do for a Business

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Smart contracts often generate a certain level of confusion. Coming from different perspectives, people define them in different ways, thus causing misunderstandings of the term within the context of what they can do for businesses. Some of the haze ensues from common definitions that don’t draw a clear distinction between legal contracts and smart contracts.

Smart Contracts vs. Legal Contracts

Though smart contract services can replace some aspects of contractual law, they are definitely not a legal concept. They do support business transactions, but more in the sense of a technical solution for the digital realm in which companies search for new ways to make their projects more profitable. Smart contracts work by delegating certain transaction elements to the computer by giving it instructions with cryptographic code.

Smart contracts are a piece of code, which blockchain developers implant in decentralized networks. They work under a set of predefined, self-executable, known-to-all-parties rules.

Smart contract services simplify many of the processes that need to be otherwise completed or verified by humans, by transferring them to a computer. In this sense, a smart contract can be a reliable auditor.

Types of Smart Contracts

Bitcoin can be considered the first smart contract in the sense of current blockchain technology. However, the cryptocurrency is a fairly limited representative of the concept, as it doesn’t depict all ways in which smart contract services work. Bitcoin is a smart contract executed on a fully decentralized network, without the interference of intermediaries or third-party fees.  

The Ethereum platform, in contrast, is not simply finance-based. Its Solidity development projects extend to business solutions. On Ethereum, developers create an open-source code to apply decentralized technologies in areas such as digital identity, voting, utilities and computing resources, to name a few.

Smart contracts can be applied to closed organizations. The Hyperledger project, for example, develops blockchain projects where decentralized networks are available only to specific participants who can join the group by invitation. Hyperledger is not fully public; businesses need to gain permission to be accepted in the inner circle. The difference between the Hyperledger projects and a 100 percent decentralized blockchain is in the business logic. It’s more viable and efficient to create a closed platform for organizations that meet the integrity and trust criteria than to give every member of the public the same level of trust.

How Do Smart Contracts Work?

If you are considering smart contract services, a blockchain developer can create a contract that sets a range of criteria to validate multiple transactions. Transactions will not be limited to a simple give-and-take exchange of value. They can also include dates, qualities or quantities, and other specifications that must be met if the transaction is to be considered valid. The event takes place only after all conditions have been met by all transactional parties.

The instructions are embedded within the code and are impossible to change unless all parties agree to update the smart contract. For instance, a second stage of the transaction can’t take place until the first one is completed. A typical example of a smart contract is a group signature, where a business transaction is valid only after a certain number of people have signed.

With smart contracts, businesses can gain a new level of protection against unknown outcomes. Because the records in a decentralized ledger are permanent, immutable and traceable, it’s virtually impossible to get an outcome that wasn’t planned by the parties.

Smart contract services have proven to be an effective solution for supply chain management. Each participant in a supply chain built on a decentralized blockchain has insight and access to the recorded transactions and can keep track of what happened at a certain point in time or location.

Immutability, permanency, and consensus are three important aspects of smart contracts that protect participants from unscrupulous activity. However, smart contracts are still executed on a computer network and are therefore vulnerable to mistakes made during their processing. Despite their imperfections, smart contracts can potentially help you develop new business solutions, such as avoiding multiple transaction fees, letting computers run secure transaction records, verifying recorded data, and even creating your own cryptocurrency.

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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.

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Blockchain-Focused ETF Arrives on London Stock Exchange

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The crypto community is still waiting for the US SEC to approve Bitcoin ETFs, with speculation which application might get approval being one of the hottest topics in 2018. However, come 2019, the US government shutdown dragged on, and the Bitcoin ETF request which had the most potential to see a grant got withdrawn by the very companies that submitted the application.

While the question of BTC ETF remains hanging in the air, blockchain-focused ETFs seem to be a different matter entirely. In a recent announcement by an independent investment managed firm called Invesco, the company has stated that it was about to launch the largest blockchain-focused ETF in the world. They managed to go through with this plan, and the ETFs have reached the London Stock Exchange today, March 11th.

The exchange-traded fund includes a portfolio containing as many as 48 different firms which are bringing exposure to the emerging technology. Among them, there is Taiwan Semiconductor Manufacturing, which is a well-known creator of chips used for crypto mining, as well as the CME Group, which is the first regulated exchange in the US which launched Bitcoin futures. There are many other well-known companies as well, such as Intel, Microsoft, and others.

Chris Mellor, the Invesco’s head of ETF equity product management in Europe, said that blockchain has a huge potential to increase earnings, even though…

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Could Jeff Bezos Turn to Bitcoin to Hide Fortune from Wife?

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Amazon’s Jeff Bezos has made numerous headlines recently due to his overly-publicized divorce, which shows all signs of being one of the most expensive ones — if not THE most expensive one — in modern history. According to estimates, it might cost him as much as $70 billion, which will make his soon-to-be-ex-wife the richest woman in human history.

However, as the process continues to unfold, many have started wondering if things may have ended up differently for Bezos if he turned to Bitcoin for help.

Bitcoin as a divorce tool?

In the last several years — since Bitcoin and other cryptos hit fame — many have started turning to BTC during their divorce proceedings. In fact, it can even be said that using the largest cryptocurrency in this way has become a new trend. The trend has been gaining so much strength that numerous law companies started including advice on what to do in regards to Bitcoin as part of their websites.

However, while the trend has been picking up in recent years, it is nowhere near as easy as it might seem. For example, if there is even a suspicion of a spouse having undisclosed holdings appears during the divorce process, it might be enough to impact the final decision of the judge. In other words, even if there is a complete lack of evidence, but…

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Three Biggest Things To Know Come Cryptocurrency Tax Season

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In recent years, digital cash systems known as cryptocurrencies such as Bitcoin and Litecoin have exploded into the public eye. A blend of cash and stocks, their use and value has grown exponentially. In 2017, the IRS decided to focus great effort on taxing them. In theory, this should be as simple as calculating taxes on any other type of property, bond, or other assets. Cryptocurrency, however, presents a unique challenge. The full extent of one person’s crypto activity can stretch across dozens of platforms and take a variety of different forms. This makes it difficult to gather all of this information cohesively, much less begin the seemingly- complicated process of reporting it.

These three tips should help anyone looking to legally report their crypto activity to figure out where to start.

Documentation is key!

There are dozens of different “exchanges” individuals can use to change their cash into crypto. When the flat currency is changed into cryptocurrency at the exchange, you establish your cost basis. This makes this data crucial when you begin the process of reporting.  Those who have used a variety of different exchanges should keep detailed records of everywhere that they made trades. Once tax season arrives, most exchanges will allow users to view their entire trading history with that exchange. This information will be necessary later to complete taxes.

Calculate your total gains

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