Smart contracts enable the execution of trustworthy transactions and agreements between anonymous parties and without the need for a legal system. Smart Contracts will bring in changes, not as fast as some predict, but will surely change the way we are used to working, as per Kai Schiller, author of the German blog blockchainwelt.de.
You would have heard of blockchains. In our last two articles, we spoke about Non-fungible Tokens and Ransomware attacks, this one is the third in the series concerning blockchains. Apart from cryptocurrencies and NFTs, there is a much more serious and beneficial application of this technology, namely smart contracts.
SMART CONTRACTS VS (TRADITIONAL) CONTRACTS
We are aware as to what entails a traditional legal contract — a document that details an agreement that parties execute with an expectation of being legally binding with a structure that includes offer, acceptance, consideration, and date with the parties signature. The endgame is Judicial Enforcement. Whereas, smart contracts bypass and ignore the legal mode and judicial enforcement is not their endgame. In contrast, smart contracts are computer programs filled with clauses “if/then” laying out every eventuality and obligation. These computer programs, once created and formally accepted by both parties, can be self-enforcing, running in the cloud. Continuous monitoring of key performance metrics determines when one of the “if/then” clauses suddenly switches from false to true, triggering automatic enforcement. Through auto-enforcement, smart contracts can add efficiencies for many kinds of agreements. This includes rental, intellectual property, financing, shipping, and manufacturing contracts.
First proposed in the 1990s by Nick Szabo, the concept of smart contract entails contract clauses written in computer programs. These are to be automatically executed as and when predefined conditions are met. Smart contracts are stored, replicated, and updated in distributed blockchains with logic consisting of transaction status. The integration of blockchain technology with smart contracts has made the dream of a “peer-to-peer market” come true.
For an enforceable legally binding contract, the common law requires four elements to be present: (a) offer; (b) acceptance; (c) consideration and (d) intentions to create legal relations. The law takes a wider approach and will enforce any promise in whatever form it is in, if the above criteria are met and if there are no vitiating factors such as misrepresentation or duress to taint the contract. Practically a contract concludes upon the agreement of a future contractual performance, which then generates rights and obligations for all parties.
The lingering question of whether smart contracts carry the same legal validity as traditional contracts warrant a definitive and authoritative answer, instead, it instigated a never-ending debate amongst academics and practitioners.
Imagine a self-executing contract that digitally enforces, verifies, and facilitates the performance or negotiation of a contract. Blockchain technology and its distributed nature are used to foster transaction credibility between contracting parties without the necessity of third parties as exhibited in regular contracts.
There are several steps involved in a blockchain-based smart beginning with agreement identification, defining setting conditions, scripting the business logic, encryption with blockchain, execution and processing on event triggers, and finally updating the network status.
Thus contractual performance obligations are memorialised in code using a strict and formal programming language, then they are executed by members of a blockchain-based network. Once a smart contract is triggered via a transaction by one of the parties, the smart contract itself acts as the parties’ agent that is deputised to assist the parties with their arrangement.
The code of the smart contract is stored on each miner’s computer and each smart contract is assigned a blockchain-based address. Parties can initiate a smart contract by sending digitally signed “transactions” to the smart contract’s address. The transactional record is stored on the blockchain, the saved record then triggers the smart contract’s execution. Owing to the consensus-based distributed architecture the smart contract’s code is run by all miners supporting the network simultaneously. The transaction in this case is a record that includes the variables necessary for the code to run, along with a digital signature of the sending party.
ERROR IN CODE — RISK EXPOSURE:
Smart contracts also suffer from material shortcomings. Any vulnerability or even an error in the code may bring consequences. And one such example is when the DAO raised more than $150 million, an individual discovered a loophole in the code and diverted almost $70 million worth of ether and it was observed that the hacker did not maliciously hack the code, but rather used the terms of the existing smart contracts to accomplish something others later found objectionable, i.e. the diversion of their money. Thus, it is evident that the systemic risks exposed by the DAO hack have fuelled the argument that raises several concerns about the functionality of smart contracts. Broadly speaking — the hack reveals that the foundational characteristics which make smart contracts attractive ought to be questioned.
RELATION WITH CRYPTOCURRENCY
Centralised form of transactions may have a single point of failure that has been solved by using blockchain technology, which provides a peer-to-peer transaction without the need of a third party. The Bitcoin decentralised cryptocurrency, released in 2009, has generated great interest in blockchain technology applications. The blockchain technology that used to be applied only for bitcoin peer-to-peer transactions has been also usable for other purposes, such as smart contracts.
In the last few years, there has been significant development in technology related to blockchain-based smart contracts that have been accumulating over the years. It ranges from various platforms that facilitate blockchain-based smart contracts, applications that utilise smart contracts and tools in developing blockchain-based smart contract applications.
While a cryptocurrency is used as a secure medium of exchange due to the use of strong cryptography for ensuring verifiability of asset transfer, control of unit creation and even evasion of regulations as well as oversight by governments across the world, smart contracts are self-executing contracts that utilise blockchain technology to digitally enforce, verify, or facilitate the performance or negotiation of a contract.
COSTS AND ADVANTAGES
Smart contracts provides for many benefits as compared to the traditional contracts: (a) Speed as smart contracts use software code that automates tasks that are typically accomplished manually; (b) Enhanced Accuracy as due to automated transactions the probability of manual error is reduced; (c) Cost-Effective as less human intervention, fewer intermediaries and thus less cost: (d)Auto-enforcement as Smart contracts are unique in their enforceability since these clauses are embedded in the applicable software itself; (e) Reducing risks. Smart contracts cannot be arbitrarily altered once they are issued due to the immutability of blockchains. All the transactions stored and replicated are traceable and auditable.
Despite the advantages mentioned hereinabove, the enforceability of more subjective obligations such as ensuring commercially reasonable efforts is affected by the inherently digital nature of smart contracts.
SMART CONTRACT AND ONLINE DISPUTE RESOLUTION
The dispute arising out of smart contract demand for non-judicial remedy systems that are cross-jurisdictional, extra-legal, and efficient hence the smart Developers and Entrepreneurs are swiftly moving to create solutions for resolving smart contract disputes and accordingly reliance over online dispute resolution systems in the blockchain. Generally, Online Dispute Resolution models have been online arbitration, AI-powered resolutions, and crowd-sourced dispute resolution. It is no surprise, especially given this history of resorting to extra-legal resolutions, that developers have turned to online arbitration for resolving blockchain disputes.
Relying on a distributed consensus model, smart contracts have the DNA of Blockchains and run on platforms similar to cryptocurrencies. These technology-enabled innovations in law are being watched closely as they make contracts more reliable simultaneously making it difficult to evade execution.
The ‘autonomous’ nature of these contracts does not require a third party to evaluate execution and even obviates the need to engage lawyers and experts to estimate execution in a granular fashion.
Despite obvious advantages, blockchain-based technologies have not shown great success as a business model. There are serious concerns about the non-green nature of computing needed to run the blockchains and some security issues which have cropped up despite the self-healing nature of blockchain nodes.
Ethereum has been an excellent example of a platform based on blockchains for smart contracts and the evolution of standards as well as tools for developing applications and utilities will pave the way for wider acceptance of these innovations. On the whole, the world is watching these innovations with caution filled with expectations.
Brijesh Singh, IPS, is an author and IG Maharashtra. Khushbu Jain is an advocate practising before the Supreme Court and a founding partner of law firm Ark Legal. They can be contacted on Twitter: @brijeshbsingh and @advocatekhushbu. The views expressed are personal.
Ethereum has been an excellent example of a platform based on blockchains for smart contracts and the evolution of standards as well as tools for developing applications and utilities will pave the way for wider acceptance of these innovations.
The Daily Guardian is now on Telegram. Click here to join our channel (@thedailyguardian) and stay updated with the latest headlines.
For the latest news Download The Daily Guardian App.
EROS HOTEL CELEBRATES 25 YEARS OF HOSPITALITY
The date 6th December 2021 marks the silver jubilee year for Eros Hotel New Delhi Nehru Place. The hotel began its journey in the year 1996 with the vision of delivering the finest Indian hospitality experiences to the guests. Today, Eros Hotel stands tall as an iconic stand-alone 5-star deluxe property offering contemporary design and comfort paired with old-world hospitality charm.
“Anniversary is a great occasion of recollecting and cherishing memories. This one is more special, as today we celebrate our hotel’s 25th anniversary” said MD of the company, Satish Sood.
“Going back in history, I would like to bring forth the vision and foresight of Late Mr. J. R. Sood. The organisation started with millions of dreams, hope and immense enthusiasm and for me, it’s a matter of great pride to see our company growing, embracing good value system and achieving milestones as we thought of,” he added.
“Over these years, CSR campaigns, sustainability initiatives, celebrating key occasions with team members and families, delivering wow experiences to our patrons through exceptional customer services, have created great memories for all of us and have contributed to hotel’s glorious journey,” he added.
Davinder Juj, General Manager of the hotel, said “We are delighted to carve a host of activities on 25th anniversary, which will be offered to make our guests and team members feel special. This is to express our heartfelt gratitude for their continued patronage and loyalty and for our teams to offer the best of the services”.
Odisha tourism conducts 12th International Sand Art Festival
The 12th edition of five days International Sand Art Festival that started on December 1 is underway at Chandrabhaga beach in Konark, Odisha.
Every year, the tourism of Odisha conducts the Chandrabhaga International Sand art festival for the sand artists to show their art and talent to the world to see. Here the immense beach is a canvas and an artists’ deft is the palette. Artists from all over the world participate in the festival, but due to Covid-19, strict protocols were followed.
Sudarsan Patnaik, organiser of the festival told ANI that due to Covid-19 fear, this year international artists couldn’t participate but a total of 100 artisans from Odisha and 12 other Indian states including Rajasthan, Maharashtra, Gujarat, West Bengal, Bihar, Andhra Pradesh, Jharkhand, Karnataka, Tamil Nadu and more have participated with full enthusiasm.
He also informed that different themes were provided to the artists every day and on December 3, Friday, the theme assigned to them was ‘eco-tourism and environment’.
Gauri, a sand artist from Odisha who is participating in the festival for the second time in her life said, “It’s a very good topic. We have to understand nature is very important and we have to save it too.”
She also told that this is her second time participating in this event, after ten years. “I am glad to see how the event has developed in the meantime. It is only stated to organise such festival where all sand artists get exposure and we are able to show our art.”
The International Sand Art Festival was started in 2015 on the Chandrabhaga beach, a short distance from Konark. It was a part of the Konark Dance Festival that is organized during the same time. Every year, the theme for the Artists hover around the burgeoning issues of the Earth.
RAHUL MITTRA BECOMES ARUNACHAL’S BRAND ADVISOR, SANJAY DUTT IS BRAND AMBASSADOR
On the occasion of the golden jubilee celebrations which mark the 50th year of the naming of the state—the BJP led Arunachal Pradesh Government has appointed former journalist, award-winning filmmaker and branding expert Rahul Mittra as Brand Advisor, and Bollywood star Sanjay Dutt as Brand Ambassador.
This announcement was made by Chief Minister Pema Khandu and Assembly Speaker Pasang Sona Dorjee at a packed function in the presence of both Sanjay Dutt and Rahul Mittra. On Monday afternoon both these personalities arrived from Mumbai by chartered flight to Dibrugarh and then by helicopter to the picturesque valley of Mechuka. On the arrival of Sanjay and Rahul, hundreds of residents made a beeline to get a glimpse of the celebrities.
A big media campaign conceptualised and executed by Rahul Mittra Films and shot by top ad-filmmaker and drummer Pentagram Shiraz Bhattacharya was kickstarted on this occasion, featuring Sanjay Dutt as a youth icon, nature lover, de-addiction proponent and an ever-evolving individual catering to the niche target audience for Arunachal tourism. Filming is currently taking place on a large scale across the state covering Ziro village, Pakke valley, Dambuk, Namsai, Parshuram Kund, Pasighat, Mechuka and Tawang. The campaign will be unveiled on the occasion of the month-long celebrations commencing on January 20 next year at Ziro where Arunachal Pradesh first got its name and Union Territory status in 1972.
The young CM Pema Khandu thanked both Sanjay and Rahul for their support and spelled out the various activities being undertaken by the state government for the 50-year celebrations. Sanjay Dutt urged the youth to stay away from drugs and get high on life while Rahul Mittra promised to put Arunachal on the world map in terms of visibility through this campaign, amidst a thundering response from the audience.
CROWN GROUP REAFFIRMS ITS COMMITMENT TOWARDS ‘ATMANIRBHAR BHARAT’ FOR INDIAN NAVY
On the glorious occasion of Navy Week 2021, the Crown Group, which is a technology provider and a strategic partner to India’s defence sector, reaffirms its commitment to provide its best contribution and impetus to the ‘Atmanirbhar Bharat’ mission for the nation as envisaged by Hon’ble PM Narendra Modi by augmenting indigenous product and services support to the Indian Navy.
The group is professionally managed, having skilled technical and operational experts, with the Group President, Vice Adm Paras Nath (Retd.), AVSM, VSM, based at the Delhi Headquarters. The Crown Group has appointed Commodore Rakesh Anand as the Head of Marine Division to spearhead and boost the division. Commodore Anand is a retd Indian Navy veteran who was also the Chairman & Managing Director of Mazagon Dock Ltd. prior to joining the Crown Group, and was responsible for the launching of three Scorpene submarines and three Destroyers/Stealth Frigates. He also delivered two Submarines, Kalvari and Khanderi to the Indian Navy besides undertaking major modernisation of the shipyard. Commodore Anand will be heading the marine companies of the group – ‘Dynatron Services Private Limited’ and ‘OSK India Pvt. Ltd’.
Speaking on the occasion, Commodore Anand said, “Keeping with the GoI vision of ‘Atmanirbhar Bharat’, the Marine division of Crown Group has enhanced its maintenance facilities in Mumbai. The Marine division is also working towards establishing the capability for manufacturing propulsion shafting and Magazine Fire Fighting System (MFFS) for warships and submarines in collaboration with the foreign OEMs.
We can proudly claim that Dynatron Services & OSK India are one of the only organised and fully equipped players in India that are present across all the coastal cities catering to the MRO and servicing of Indian naval ships. We are also a unique Group that provides both Marine Engineering and Weapons system MRO support to Indian Navy & Coast Guard.”
Group President said, “Our Karwar facility has the biggest workshop near India’s main naval base spread over 5 acres with facilities for repair and overhauling of all aero-marine components, manufacture of spares along with Mechanical, Electrical and Electronics workshop. The workshop is supporting MRO activities for the aircraft carrier, warships and the submarines at the Naval base.”
Dynatron and OSK India, have been dedicating themselves for taking on MRO activities. OSK India has recently repaired critical weapon equipment modules for the Indian Navy. Dynatron has a long-term partnership with many foreign OEMs including JSC Sevmash. Dynatron also has sole authorisation for repairs and maintenance of Gearboxes & thrusters from ZF Marine (Germany) and an exclusive partnership with Kubota engines Japan coupled with Mase Generators, Italy.
On the occasion of Navy Day, Crown Group rededicates itself towards the success of Atmanirbhar Bharat. Navy Day is observed on December 4 every year, since it was on the day in 1971 that missile boats of the Indian Navy launched a daring attack on the Karachi harbour, paralysing Pakistan’s entire coastal defence apparatus.The year 2021 marks the 50th anniversary of the 1971 Indo-Pak War – the historic victory of India’s armed forces in which the Indian Army made the Pakistani’s surrender.
VIRGIL ABLOH: AN INDELIBLE LEGACY
As the founder of the iconic brand Off-White and the artistic director for Menswear, Louis Vuitton, Abloh, a first-generation Ghanaian American, was a pioneer in the global fashion scenario— his indomitable influence as a creative prodigy transcended the boundaries of clothes.
The terrain of fashion today credits a majority of its aesthetic sensibility to the boundless creativity of Virgil Abloh. The designer, who died from cardiac angiosarcoma, a rare form of cancer, at the age of 41 on November 28 in Chicago, was called the fashion visionary, but there was no denying that his prodigious work shaped the present. As the founder of the cult brand Off-White and the artistic director of Louis Vuitton’s menswear division, Abloh, a first-generation Ghanaian American, was a pioneer in the global fashion scenario—his influence transcended the boundaries of only clothes.
Abloh’s creative genius spread across myriad mediums and defied conformity. His mother was a seamstress which influenced him to sew his own clothes as a teenager before he set forth to pursue fashion. He also studied civil engineering and obtained a degree in Architecture.
Off-white, Abloh’s iconic streetwear brand, brought the excitement of a much-hyped collaboration to the world of high fashion and luxury. With Off-White, he collaborated with many premium brands and companies, including Rimowa, Mercedes Benz, the NBA, Levi’s, Moncler, Jimmy Choo, Kith, Timberland and Byredo. His most notable collaborative relationship, however, may have been with Nike, with which he did multiple collections, one of which netted him the “Shoe of the Year” award at the 2017 Footwear News Achievement Awards. With Nike, he also designed competition outfits for Serena Williams. Abloh’s talents were also in high demand by many of his celebrity friends, who commissioned bespoke creations running the gamut from Hailey Bieber’s Off-White wedding dress and veil that read “Till death do us part” in Abloh’s signature irony quotes to Drake’s personal plane that he had Abloh customise with an ethereal blue sky and cloud pattern. Although Abloh’s body of work was often dictated by his talent to capture the essence of an era, his gift lies with his expensive curiosity and unflinching desire to create.
The Louis Vuitton Miami show was a visual tribute (and an emotional one at that) to Virgil Abloh, as friends, collaborators and fans paid homage to him under fireworks and a drone light show. The Spring/Summer 2022 Men’s show marked Abloh’s historical last as the celebrated Creative Director for Menswear.
The front row included longtime supporter Kanye West, who sat next to Kim Kardashian and their daughter North. Other front-row attendees were Rihanna and ASAP Rocky, Pharrell Williams, Joe Jonas, Ricky Martin, Venus Williams, Bella Hadid, 21 Savage and Joan Smalls.
Just before 7 PM, as the mood shifted from somber to party mode, a dazzling light show filled the sky. It began as a paper plane (a predominant icon in Abloh’s collections), before fluctuating into avatars of the Louis Vuitton monogram, a palm tree and the initials “L.V.,” which turned into “V.A.” For the finale, the drones spelled “Virgil was here” (goosebump-inducing); within moments, these mesmerising visuals of tributes went viral on social media.
MISSION TANDRUST PUNJAB TO KICK OFF RESEARCH PROJECTS WORTH RS 7 CR
Mission Tandrust Punjab, with a zeal to start research and development in various fields, has now planned a 360-degree chart for different research projects comprising clean air, clean water, healthy soil, waste management, green Punjab, safe food, road safety, khelo Punjab, nutrition, preventive health.
These all are the sub-missions that are spearheaded by a lead department supported with different line departments. “The mission has undertaken various activities since it was revamped and launched by the Punjab government in June 2021, under the administrative control of the Department of Science, Technology, and Environment,” IFS Saurabh Gupta, CEO Mission Tandrust Punjab, told The Daily Guardian.
To achieve the objectives of the mission, the first meeting of the Steering Committee headed by Chief Secretary Punjab was held 2nd December 2021 in which Dilip Kumar, Principal Secretary, Department of Science and Technology and Saurabh Gupta, CEO of the Mission made a presentation in which the innovative research projects for about Rupees seven crores were discussed and approved. Reiterating the importance of the mission, the Chief Secretary appreciated these research projects developed by the Directorate of Environment and Climate Change by involving prestigious institutions like IIT Ropar, AIIMS, Punjab Agriculture University, Punjab Biotechnology incubator, Punjab State Council for Science and Technology. The Chief Secretary said that these interventions shall help in ensuring good health of the people through the provision of safe food, clean water, etc.
An awareness project for the Mission was also approved to be implemented in the Pushpa Gujral Science City, Kapurthala.
The Chief Secretary suggested that more such innovative research projects are required under this mission for which the State Govt. shall provide adequate funds. The projects approved have been time-lined for 18 months added Gupta.
Opinion1 year ago
South Block’s mistakes will now be corrected by Army
Sports1 year ago
When a bodybuilder breaks Shoaib’s record
News2 years ago
PM Modi must take governance back from babus
Spiritually Speaking1 year ago
Spiritual beings having a human experience
News1 year ago
Chinese general ordered attack on Indian troops: US intel report
Legally Speaking2 years ago
Law relating to grant, rejection and cancellation of bail
Sports1 year ago
West Indies avoid follow-on, England increase lead to 219
Royally Speaking1 year ago
The young royal dedicated to the heritage of Jaipur