WEBVTT

00:00:00.000 --> 00:00:03.390 align:middle line:84%
Smart contracts are
self-executing contracts

00:00:03.390 --> 00:00:05.520 align:middle line:84%
with the terms between
buyer and seller

00:00:05.520 --> 00:00:08.830 align:middle line:84%
directly written
into lines of code.

00:00:08.830 --> 00:00:10.920 align:middle line:84%
This allows transactions
and agreements

00:00:10.920 --> 00:00:13.110 align:middle line:84%
to take place among
anonymous parties

00:00:13.110 --> 00:00:18.060 align:middle line:84%
without a central
authority, legal system,

00:00:18.060 --> 00:00:21.990 align:middle line:90%
or external enforcement system.

00:00:21.990 --> 00:00:24.840 align:middle line:84%
The code and the agreements
contained in the contract

00:00:24.840 --> 00:00:27.540 align:middle line:84%
exist across a
distributed, decentralized

00:00:27.540 --> 00:00:28.950 align:middle line:90%
blockchain network.

00:00:28.950 --> 00:00:31.410 align:middle line:84%
Blockchain technology
is a type of database

00:00:31.410 --> 00:00:34.980 align:middle line:84%
that stores data in blocks
that is then chained together.

00:00:34.980 --> 00:00:37.950 align:middle line:84%
The code controls the
implementation of the contract,

00:00:37.950 --> 00:00:41.190 align:middle line:84%
and the transactions are
trackable and permanent.

00:00:41.190 --> 00:00:43.350 align:middle line:84%
Blockchain technology
is often thought

00:00:43.350 --> 00:00:45.510 align:middle line:84%
of as the foundation
for Bitcoin,

00:00:45.510 --> 00:00:47.610 align:middle line:84%
but it has evolved
beyond supporting

00:00:47.610 --> 00:00:49.110 align:middle line:90%
the virtual currency.

00:00:49.110 --> 00:00:51.780 align:middle line:84%
Nick Szabo, computer
scientist and inventor

00:00:51.780 --> 00:00:55.170 align:middle line:84%
of virtual currency Bit
Gold, defined smart contracts

00:00:55.170 --> 00:00:57.930 align:middle line:84%
as computerized
transaction protocols that

00:00:57.930 --> 00:00:59.910 align:middle line:90%
execute terms of a contract.

00:00:59.910 --> 00:01:02.460 align:middle line:84%
Szabo wanted to spread
the functionality

00:01:02.460 --> 00:01:05.760 align:middle line:84%
of electronic transaction
methods, such as Point of Sale,

00:01:05.760 --> 00:01:07.710 align:middle line:90%
or POS, to the digital realm.

00:01:07.710 --> 00:01:09.860 align:middle line:90%
[MUSIC PLAYING]

00:01:09.860 --> 00:01:11.000 align:middle line:90%