Today, most transactions are based on traditional contractual agreements composed of paperwork, that often need trusted third parties to validate the fulfillment of terms outlined in the agreement. This method is outdated, slow, and, most importantly, not cost-effective. This is why developers using blockchain, are using smart contracts to automatically execute transactions using basic lines of code stored on the blockchain when agreement conditions are met. However, developers using smart contracts built on first-generation blockchains are facing challenges that are preventing their applications from gaining mainstream adoption. These smart contracts are slow to propagate, costly, and do not scale for real-world use-cases. These impediments have to be removed for viable mainstream adoption.

Algorand’s smart contracts (ASC1) remove these barriers as a trusted, seamless solution with proven performance that is not only faster, scalable and cost-effective, but also functionally advanced to enable sophisticated and complex application. Algorand’s Smart Contracts (ASC1s) are trustless programs that execute on chain, where users can be confident that the program was run without error and the results were not tampered with. They are integrated into Algorand’s Layer-1, inheriting the same powerful speed, scale, finality, and security as the Algorand platform itself, and are cost effective and error-free. ASC1s have the ability to automatically enforce custom rules and logic, from simply defining how assets can be transferred to complex application logic and flow. ASC1s are written in a new language called Transaction Execution Approval Language (TEAL) as well as PyTeal, a python language binding.

Smart Contracts Enable the disruption of economies and the creation of new business models across different industries with efficient and automated transactions and applications, allowing for a trustless execution of an agreement.

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