Although smart contracts are of great interest to a lot of people, finding the real use cases for this technology is still very challenging. Hundreds of potential applications of smart contracts exist, and some industries are getting more attention than others. Below are some examples, in random order.
#6: Multiparty Smart Contracts
In the world of cryptocurrency, multisignature solutions have become the new normal over the past few years. This does not just apply to wallet solutions, but also to smart contracts. A multiparty smart contract allows user A to lend money to user B to buy a property, car, etc. In this instance, a smart contract can serve as a legally binding agreement between the involved parties.
#5: Distributed Autonomous Societies
One of the more ambitious plans involving smart contracts revolves around creating distributed autonomous societies. Users can form groups in their preferred location to establish trade agreements with other groups of users. These agreements are self-enforceable due to the nature of smart contract technology.
#4: Distributed Autonomous Governments
Setting up a fully distributed autonomous society may be a challenge, and the same can be said for an automated government. Smart contracts allow, in theory, users to create their own self-enforcing government services. Whether or not this will ever lead to a disruption of the traditional governmental model is a different matter altogether.
#3: Exchanging Digital Value
The most common use case for smart contracts today is as a means of exchanging value between parties. Although this use case doesn’t even require smart contracts, it’s always good to have a log of all transactions and proof that a previous agreement existed between both parties prior to the transaction being made.
#2: Smart Rights
One of the more exotic options to explore comes in the form of smart rights solutions. These are especially useful when dealing with digital content. They also change the way people think of ownership in general, especially where blockchain assets are concerned. Translating this approach to real-world assets and products is a big challenge, for the time being.
#1: Distributed Autonomous Organizations
The DAO idea has been tried before on a large scale, and it quickly failed. The DAO is the best example of how good ideas are not sufficient to sustain an untested business model for a lengthy period of time. Even so, the concept still holds merit, as smart contracts can allow for peer-to-peer deliveries, purchases of electricity from the cheapest provider at any time automatically, and so forth. This particular approach may have the most potential in the long term.