Smart Contracts were tested in the 90s whenthe technologies allowed to implement Smart Contract experimentation, but theidea of ??an Intelligent Contract dates back to the mid-1970s. At the time theneed was very simple and it was necessary to manage the activation ordeactivation of a software license according to some very simple conditions.The license of certain software was in fact managed by a digital key thatallowed the software to function if the customer had paid the license andceased to function on the date of expiry of the contract. An automatic contract that is activated under certain conditions Smart Contract needs legal support for its drafting, but does not need it for verification and activation. The Smart Contract refers to the standards of behavior and access to certain services and is made available, accepted and implemented also as a form of development of traditional services.
A Smart Contract is the “translation” or “transposition” in code of a contract in order to automatically verify the fulfillment of certain conditions (control of basic data of the contract) and to automatically execute actions (or make provision so that can perform certain actions) when the conditions determined between the parties are reached and verified. In other words, the Smart Contract is based on a code that “reads” both the clauses that have been agreed and the operating conditions in which the agreed conditions must occur and automatically runs when the data referring to the real situations correspond to the data referred to the conditions and agreed clauses. Why does Smart Contract needs Big Data and Data Science And precisely because the absence of human intervention also corresponds to the absence of an interpretative contribution, the Smart Contract must be based on extremely precise descriptions for all the circumstances, all the conditions and all the situations that must be considered.
Here is the management of data and Big Data in particular becomes a critical factor essential to establish the quality of the Smart Contract. At the same time for Smart Contracts it is essential to define in an extremely precise way the data sources to which the contract is called to comply. Smart Contract are called to receive data and information from subjects that are defined and certified by the parties in the contract itself and which must be identified, checked and interpreted by the Smart Contract on the basis of precise rules which in turn represent one of the most relevant parts and strategic contracts that obviously determine the final output.Smart Contract as a code executionAnd here comes the most relevant point concerning thesubstantial differences between the traditional contract and the SmartContract. Smart Contract is in fact “child” of the execution of acode by a computer. It is a program that calculates deterministically (withidentical results against identical conditions) the information that iscollected. In other words, if the inputs are the same, the results will beidentical. This point is extremely relevant because if on the one hand itrepresents a certainty and a certainty as it guarantees to the parties anabsolute “objective certainty” excluding any form of interpretation,on the other it shifts the weight on the code, on the programming theresponsibility or even the power to decide.
Contractors have the task ofdefining conditions, clauses, methods and rules of control and action, but oncetheir contract has become a code and therefore a Smart Contract and thecontractors accept it, the effects no longer depend on their will. Smart Contract: the Insurances reward theadoption of the IoT on the carsAn example comes from the world of motor insurance, which onthe basis of data obtained through Internet of Things equipment on board thecars are able to provide data on driver behavior that can influence and createcertain conditions that activate or deactivate advantage clauses or downside.For example, exceeding speed limits determined by the contract can be read asconditions of greatest danger and determine a contractual change in theconditions applied for example in the value of the insurance premium. Anotherexample comes from the world of media where digital rights management ismanaged with the provision and access to certain multimedia services. The role of the legal and the developerIf the Smart Contract is presumed to do its job well, it mustprovide a series of guarantees to all the parties involved and, primarily atthis point in our analysis, the Smart Contract must guarantee that the codewith which it was written can not be modified. that the data sources thatdetermine the conditions of application are certified and reliable, that themethods of reading and checking these sources are in turn certified.
The SmartContract must be precise both in its drafting and in the management of therules that determine its application and the rules that must govern anyanomalies.