Smart Contracts
Smart contract is a contract that is written in program code. It is executed automatically when the parties to the contract fulfill their conditions. For a general understanding of automatic contracts, we can imagine a machine selling sodas. The customer selects a product and pays for it — the machine dispenses the purchase itself. In this example, there is a limitation — the administrator of the machine, who must regularly maintain it: perform collection, replenish the stock of goods.
Smart contracts operating on the blockchain do not require outside intervention — they are performed completely autonomously. The subject matter and terms of the contract are written in code in programming languages, and the parties to the transaction confirm their participation with a digital signature.
History and impact on blockchain industry
In 1994, American scientist Nick Szabo revealed the concept of smart contracts. It became possible to realize the idea with the emergence of bitcoin in 2009.
In 2013, Vitalik Buterin published the WhitePaper of the Ethereum Network. This blockchain was not limited to the use of financial protocols, but allowed users to create decentralized applications and launch smart contracts.
Smart contracts on TON
In 2021, Nikolai Durov published the WhitePaper of TON blockchain. The network was based on key characteristics — speed, security, and scalability. In the WhitePaper, Nikolai described the environment for running DApps — applications that run on smart contracts.
The advantage of TON blockchain was close integration with Telegram. Access to the messenger's audience opens up new opportunities for popularizing blockchain technologies and decentralized services.
Technical Realization
FunC, Fift, and Tact programming languages are used to develop smart contracts. The smart contracts are deployed in TON Virtual Machine (TVM). TVM efficiently handles code execution and scalability through sharding, a technology that dynamically distributes the load. The smart contract code in TON is verified to find bugs and vulnerabilities before launch.
Competitive advantages of smart contracts on TON
Performance. High speed transaction processing provides a better user experience and service interaction.
Scalability. TON's unique sharding architecture allows mass transactions to be processed quickly and efficiently. Developers have the opportunity to create services with high bandwidth requirements.
Low Fees. Economic feasibility and profitable operations are ensured by an efficient microtransaction system. The fees are fixed and can only be changed if the validators vote in favor.
Security and Audit
Blockchains are audited for security by auditing companies. For example, ChainSecurity, OpenZeppelin or CertiK, the last of which audited TON in spring 2022. This is an important process that allows independent experts to verify the reliability of blockchain networks and smart contracts.
The audit includes: finding vulnerabilities, load testing, logic validation, and compliance with business requirements. The audit produces a comprehensive report with recommendations to address risks.
As part of its grant program, TON Foundation conducts activities aimed at finding bugs and vulnerabilities. These activities complement the audit and help the foundation engage the community in the security development of TON ecosystem.
Potential of smart contracts application
State registers — property registration, public procurement, budget allocation, copyright protection, voting.
Financial sector — instant lending, ICOs (venture capital investments), crypto-asset exchanges.
Services and Management — Insurance, DAO, contract drafting, identification, notarization.
Telegram's audience's access to blockchain technology is creating an environment for the mass use of automated contracts. In the future, we will see new forms of interactions of ownership, value and obligations described in smart contracts on TON.