Smart Contracts in Blockchain are essential to run safe and secure transactions systematically. In a nutshell, Smart Contracts are computer programs/protocols stored on the blockchain, executed in self when specific conditions are met. The term ‘smart contract’ is introduced by Nick Szabo. It executes the terms of the agreement between the buyer and seller which are written in codes. The agreement facilitates the exchange of money, shares, property, etc.,
Smart contracts operate upon the “If/when…then…” statement is written into the code. The codes stored in the blockchain have executed an action whenever a built-in condition has been met. Smart Contracts run without any help from the intermediaries. For example, consider if person B is selling the house to Person A. Person B wants the cash as in a return to his house. This agreement can be created in a smart contract and is stored in the blockchain. Once it is placed, it cannot be modified. Now A need not fear that B will raise the agreement money and B does not need to worry that A may cheat him for any cause. Also, the participants don't need to pay any third party or lawyers to process the transaction and for payment proof. They both save money and time.
You can program smart contracts to work for the masses. The Ethereum smart contracts are written in the Solidity programming language. The rules and limitations are predefined in the code which makes no one manipulates the rules in contracts. The smart contracts only will run if all the participants agree and sign the agreement.
Smart Contracts working principles are broken down in simple steps here:
Below listed are the widely used smart contract platforms to develop and execute on the blockchain.