We ended 2016 with a couple of blog posts about smart contracts and blockchains – the technology driving such contracts and how smart contracts are different from traditional contracts. This week, we pick up the thread to have a glimpse at a few real-world examples of smart contracts in action.
Smart Contracts Range of use cases
Even though it’s a new technology, new avenues for the use of smart contracts are being discovered every day. Below is an indicative list of how and where such contracts can be utilized:
- Financial Services – Trade clearing and settlement, coupon payments, insurance claim processing, and microinsurance
- Life sciences and health care – Electronic medical records, personal health tracking, and population health data access
- Media, technology, and telecom – Royalty distribution
- Energy & Resources – Autonomous electric vehicle charging stations
- Others – Recordkeeping, peer-to-peer transactions, supply chain, and trade finance documentation
Smart contracts are being developed at a rapid pace and top global institutions are investing heavily in this technology. A few examples are:
- Smart contract VC-related deals totaled $116 million in Q1 of 2016, more than twice as much as the prior three quarters combined and accounting for 86 percent of total blockchain venture funding
- An Ethereum-based organization has raised over $150 million to experiment with and develop smart contract-driven applications
- The Australian Securities Exchange is developing a blockchain-based post-trade solution to replace its current system
- The Post-Trade Distributed Ledger Group, an organization launched to explore post-trade applications on the blockchain, has 37 financial institutions as members
- Five global banks are building proof-of-concept systems with a trade finance and supply chain platform that uses smart contracts
- Barclays Corporate Bank plans to leverage a smart contract bill-of-lading platform to help its clients reduce supply chain management costs
- The state of Delaware announced initiatives to utilize smart contracts for state-recognized “distributed ledger shares” and to streamline back-office procedures
We’ll be concluding this blog series next week with a look at the benefits of smart contracts over traditional ones. As always, we’d love to hear back from you so please share your feedback and comments in the comments section below.
