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tag-use-cases"> <header class="entry-header"> <h1 class="entry-title">How Smart Contracts Can Revolutionize International Agreements</h1> <div class="entry-meta"> <span class="posted-on">Posted on <a href="https://www.haptic.ro/how-smart-contracts-can-revolutionize-international-agreements/" rel="bookmark"><time class="entry-date published" datetime="2023-09-07T11:00:50+00:00">Thursday September 7th, 2023</time></a></span><span class="byline"> by <span class="author vcard"><a class="url fn n" href="https://www.haptic.ro/author/d-chirtes/">Haptic</a></span></span> </div> </header> <div class="entry-content"> <div dir="auto" style="text-align: justify;">International agreements are contracts that involve parties from different countries or jurisdictions. They can be used for various purposes, such as trade, investment, cooperation, dispute resolution, and more. However, international agreements also face many challenges, such as:<a href="https://www.haptic.ro/wp-content/uploads/2023/09/Smart-Contracts.jpg"><img loading="lazy" class="alignright wp-image-25497 size-medium" src="https://www.haptic.ro/wp-content/uploads/2023/09/Smart-Contracts-300x283.jpg" alt="" width="300" height="283" srcset="https://www.haptic.ro/wp-content/uploads/2023/09/Smart-Contracts-300x283.jpg 300w, https://www.haptic.ro/wp-content/uploads/2023/09/Smart-Contracts.jpg 450w" sizes="(max-width: 300px) 100vw, 300px" /></a></div> <ul style="text-align: justify;"> <li dir="auto"><strong>Complexity:</strong> International agreements often involve multiple parties, languages, laws, and regulations. They require extensive negotiation, drafting, and verification to ensure that all terms and conditions are clear and consistent.</li> <li dir="auto"><strong>Cost:</strong> International agreements can be expensive to create and enforce. They may require the involvement of intermediaries, such as lawyers, arbitrators, or courts, who charge fees for their services. They may also incur transaction costs, such as taxes, tariffs, or exchange rates.</li> <li dir="auto"><strong>Trust:</strong> International agreements rely on the good faith and compliance of the parties involved. However, there may be cases of fraud, breach, or dispute that can undermine the validity and effectiveness of the agreement. Moreover, there may be differences in the interpretation and enforcement of the agreement across different jurisdictions.</li> </ul> <div dir="auto" style="text-align: justify;"></div> <div dir="auto" style="text-align: justify;">These challenges can make international agreements time-consuming, risky, and inefficient. Fortunately, there is a technology that can address these issues and improve the way international agreements are made and executed: smart contracts.</div> <div dir="auto" style="text-align: justify;"></div> <div dir="auto" style="text-align: justify;"><strong>What are smart contracts?</strong></div> <div dir="auto" style="text-align: justify;"></div> <div dir="auto" style="text-align: justify;">Smart contracts are computer programs that run on a blockchain platform. They are designed to automatically execute the actions specified in an agreement when certain conditions are met. For example, a smart contract can release funds to a seller when a buyer confirms the delivery of goods.</div> <div dir="auto" style="text-align: justify;"></div> <div dir="auto" style="text-align: justify;">Smart contracts have several advantages over traditional contracts:</div> <ul style="text-align: justify;"> <li dir="auto"><strong>Accuracy:</strong> Smart contracts record all terms and conditions in explicit detail. They eliminate the possibility of human error or ambiguity that can arise from manual or verbal communication.</li> <li dir="auto"><strong>Transparency:</strong> Smart contracts are stored on a public and distributed ledger that is accessible and verifiable by all parties involved. They ensure that everyone has the same information and understanding of the agreement.</li> <li dir="auto"><strong>Speed:</strong> Smart contracts execute instantly and automatically when the conditions are met. They do not require any paperwork or intermediaries to process or approve the transactions.</li> <li dir="auto"><strong>Security:</strong> Smart contracts are encrypted and immutable. They cannot be altered or tampered with by anyone without the consent of all parties involved. They also protect the privacy and identity of the parties by using cryptographic keys and signatures.</li> <li dir="auto"><strong>Efficiency:</strong> Smart contracts reduce the need for intermediaries and their associated costs and delays. They also simplify the management and monitoring of the agreement by providing a clear and consistent record of the transactions.</li> </ul> <div dir="auto" style="text-align: justify;"></div> <div dir="auto" style="text-align: justify;"><strong>How can smart contracts revolutionize international agreements?</strong></div> <div dir="auto" style="text-align: justify;"></div> <div dir="auto" style="text-align: justify;">Smart contracts can revolutionize international agreements by making them more reliable, efficient, and flexible. Some examples of how smart contracts can be used for international agreements are:</div> <ul style="text-align: justify;"> <li dir="auto"><strong>Trade:</strong> Smart contracts can facilitate cross-border trade by automating the payment and delivery of goods and services. They can also reduce trade barriers and costs by eliminating intermediaries, taxes, tariffs, or exchange rates.</li> <li dir="auto"><strong>Investment:</strong> Smart contracts can enable foreign direct investment by automating the transfer of funds and assets between investors and investees. They can also provide transparency and accountability by tracking the performance and returns of the investment.</li> <li dir="auto"><strong>Cooperation:</strong> Smart contracts can foster international cooperation by enabling joint projects and initiatives between different countries or organizations. They can also ensure compliance and coordination by enforcing the rules and obligations of the cooperation.</li> <li dir="auto"><strong>Dispute resolution:</strong> Smart contracts can prevent or resolve disputes by providing a clear and objective record of the agreement and its execution. They can also implement arbitration or mediation mechanisms by appointing neutral third parties or using predefined criteria to settle disputes.</li> </ul> <p style="text-align: justify;">Here is a table I made with the advantages and disadvantages of traditional and smart contracts for different signed agreements:</p> <table> <tbody> <tr> <td width="113"><strong>Type of agreement</strong></td> <td width="246"><strong>Traditional contract</strong></td> <td width="217"><strong>Smart contract</strong></td> </tr> <tr> <td width="113"><strong>Trade</strong></td> <td width="246">+ Customizable and negotiable + Legally enforceable and flexible</p> <p> </p> <p>– Complex and costly</p> <p>– Prone to fraud and miscommunication</td> <td width="217">+ Secure and transparent</p> <p>+ Fast and efficient</p> <p>+ Automated and self-enforcing</p> <p> </p> <p>– Difficult to implement and modify</p> <p>– Not always legally enforceable or compatible</td> </tr> <tr> <td width="113"><strong>Investment</strong></td> <td width="246">+ Customizable and negotiable</p> <p>+ Legally enforceable and flexible</p> <p> </p> <p>– Complex and costly</p> <p>– Prone to fraud and miscommunication</td> <td width="217">+ Secure and transparent + Fast and efficient</p> <p>+ Automated and self-enforcing</p> <p> </p> <p>– Difficult to implement and modify</p> <p>– Not always legally enforceable or compatible</td> </tr> <tr> <td width="113"><strong>Cooperation</strong></td> <td width="246">+ Customizable and negotiable</p> <p>+ Legally enforceable and flexible</p> <p> </p> <p>– Complex and costly</p> <p>– Prone to fraud and miscommunication</td> <td width="217">+ Secure and transparent + Fast and efficient</p> <p>+ Automated and self-enforcing</p> <p> </p> <p>– Difficult to implement and modify</p> <p>– Not always legally enforceable or compatible</td> </tr> <tr> <td width="113"><strong>Dispute resolution </strong></td> <td width="246">+ Customizable and negotiable</p> <p>+ Legally enforceable and flexible</p> <p> </p> <p>– Complex and costly</p> <p>– Prone to fraud and miscommunication</td> <td width="217">+ Secure and transparent</p> <p>+ Fast and efficient</p> <p>+ Automated and self-enforcing</p> <p> </p> <p>– Difficult to implement and modify</p> <p>– Not always legally enforceable or compatible</td> </tr> </tbody> </table> <div dir="auto" style="text-align: justify;"></div> <div dir="auto" style="text-align: justify;"> <p>Here is a table I made with the advantages and disadvantages of traditional and smart contracts for different signed agreements:</p> <table> <tbody> <tr> <td width="113"><strong>Industry</strong></td> <td width="246"><strong>Smart contract application</strong></td> <td width="217"><strong>Example</strong></td> </tr> <tr> <td width="113"><strong>Banking</strong></td> <td width="246">Smart contracts can enable faster, cheaper, and more secure transactions between banks and customers.</p> <p>They can also automate processes such as loan issuance, KYC verification, and fraud detection.</td> <td width="217">Bank of America is exploring the use of smart contracts to streamline trade finance operations and reduce operational risks.</td> </tr> <tr> <td width="113"><strong>ITC</strong></td> <td width="246">Smart contracts can facilitate the creation, distribution, and protection of digital content and intellectual property.</p> <p>They can also enable peer-to-peer sharing and monetization of data and services.</td> <td width="217">Microsoft is using smart contracts to create a decentralized identity system that allows users to control their own data and access online services.</td> </tr> <tr> <td width="113"><strong>Power energy</strong></td> <td width="246">Smart contracts can enable the integration of renewable energy sources into the grid, as well as the optimization of energy consumption and distribution.</p> <p>They can also enable peer-to-peer trading and payment of energy among prosumers.</td> <td width="217">Power Ledger is a platform that uses smart contracts to enable the trading of renewable energy across different markets and regions.</td> </tr> <tr> <td width="113"><strong>Automotive and transport</strong></td> <td width="246">Smart contracts can improve the efficiency and safety of transportation systems by automating tasks such as vehicle registration, insurance, maintenance, and parking.</p> <p>They can also enable new business models such as ride-sharing and car-sharing.</td> <td width="217">Toyota is developing a blockchain-based platform that uses smart contracts to enable the sharing of autonomous vehicles and data among drivers, passengers, and service providers.</td> </tr> <tr> <td width="113"><strong>Logistic</strong></td> <td width="246">Smart contracts can enhance the transparency and traceability of supply chains by recording and verifying the movement of goods and assets across different parties.</p> <p>They can also automate processes such as invoicing, payment, and dispute resolution.</td> <td width="217">Walmart is using smart contracts to track the provenance and quality of food products from farm to fork.</td> </tr> <tr> <td width="113"><strong>Hospitality management</strong></td> <td width="246">Smart contracts can improve the customer experience and loyalty in the hospitality industry by enabling faster and cheaper booking, check-in, and check-out processes.</p> <p>They can also enable personalized services and rewards based on customer preferences and behavior.</td> <td width="217">Winding Tree is a platform that uses smart contracts to connect travelers directly with hotels, airlines, and other service providers, without intermediaries or commissions.</td> </tr> </tbody> </table> <p>Smart contracts are a powerful technology that can revolutionize international agreements. They can make international agreements more accurate, transparent, speedy, secure, and efficient. They can also enable new forms of international agreements that are more flexible and adaptable to changing needs and circumstances.</p> </div> <div dir="auto" style="text-align: justify;"></div> <div dir="auto" style="text-align: justify;">I hope you enjoyed reading this blog article. If you have any questions or feedback, please feel free to contact us. Thank you for your attention!</div> <div dir="auto" style="text-align: justify;"></div> <div dir="auto" style="text-align: justify;">If you want to learn more about smart contracts and how they work on blockchain platforms, you can check out these resources:</div> <div dir="auto" style="text-align: justify;"></div> <div dir="auto" style="text-align: justify;"><em>Sources:</em></div> <div dir="auto" style="text-align: justify;"><em>(1) What are smart contracts on blockchain? | IBM. <a href="https://www.ibm.com/topics/smart-contracts" target="_blank" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://www.ibm.com/topics/smart-contracts&source=gmail&ust=1694156548371000&usg=AOvVaw12xv6cuf7v1dwbS-5cDGlX">https://www.ibm.com/topics/<wbr />smart-contracts</a>.</em></div> <div dir="auto" style="text-align: justify;"><em>(2) What Are Smart Contracts on the Blockchain and How They Work – Investopedia. <a href="https://www.investopedia.com/terms/s/smart-contracts.asp" target="_blank" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://www.investopedia.com/terms/s/smart-contracts.asp&source=gmail&ust=1694156548371000&usg=AOvVaw1SN61drxhFTEIZKrp5s_XJ">https://www.investopedia.com/<wbr />terms/s/smart-contracts.asp</a>.</em></div> <div dir="auto" style="text-align: justify;"><em>(3) What are smart contracts on blockchain? | IBM. <a href="https://www.ibm.com/topics/smart-contracts" target="_blank" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://www.ibm.com/topics/smart-contracts&source=gmail&ust=1694156548371000&usg=AOvVaw12xv6cuf7v1dwbS-5cDGlX">https://www.ibm.com/topics/<wbr />smart-contracts</a>.</em></div> <div dir="auto" style="text-align: justify;"><em>(4) What Are Smart Contracts on the Blockchain and How They Work – Investopedia. <a href="https://www.investopedia.com/terms/s/smart-contracts.asp" target="_blank" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://www.investopedia.com/terms/s/smart-contracts.asp&source=gmail&ust=1694156548371000&usg=AOvVaw1SN61drxhFTEIZKrp5s_XJ">https://www.investopedia.com/<wbr />terms/s/smart-contracts.asp</a>.</em></div> <div dir="auto" style="text-align: justify;"><em>(5) Smart contract – Wikipedia. <a href="https://en.wikipedia.org/wiki/Smart_contract" target="_blank" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://en.wikipedia.org/wiki/Smart_contract&source=gmail&ust=1694156548371000&usg=AOvVaw39YdFYTt7PFmkNHbkt6wRP">https://en.wikipedia.org/wiki/<wbr />Smart_contract</a>.</em></div> <div dir="auto" style="text-align: justify;"><em>(6) 10 Advantages of Using Smart Contracts | by ChainTrade | Medium. <a href="https://medium.com/@ChainTrade/10-advantages-of-using-smart-contracts-bc29c508691a" target="_blank" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://medium.com/@ChainTrade/10-advantages-of-using-smart-contracts-bc29c508691a&source=gmail&ust=1694156548371000&usg=AOvVaw1TknTI-u-BRWrrHTIa5Uwo">https://medium.com/@<wbr />ChainTrade/10-advantages-of-<wbr />using-smart-contracts-<wbr />bc29c508691a</a>.</em></div> <div dir="auto" style="text-align: justify;"><em>(7) . <a href="https://bing.com/search?q=smart+contracts+benefits+for+international+agreement" target="_blank" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://bing.com/search?q%3Dsmart%2Bcontracts%2Bbenefits%2Bfor%2Binternational%2Bagreement&source=gmail&ust=1694156548371000&usg=AOvVaw3_bsHKsgX0sCH9VCPdXKnP">https://bing.com/search?q=<wbr />smart+contracts+benefits+for+<wbr />international+agreement</a>.</em></div> <div dir="auto" style="text-align: justify;"><em>(8) Smart Contracts – Overview, Uses, Benefits, Limitations. <a href="https://corporatefinanceinstitute.com/resources/valuation/smart-contracts/" target="_blank" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://corporatefinanceinstitute.com/resources/valuation/smart-contracts/&source=gmail&ust=1694156548371000&usg=AOvVaw1ZOCLnaXqNSKVwwYMs3xiG">https://<wbr />corporatefinanceinstitute.com/<wbr />resources/valuation/smart-<wbr />contracts/</a>.</em></div> <div dir="auto" style="text-align: justify;"><em>(9) Real World Examples of Smart Contracts | Gemini. <a href="https://www.gemini.com/cryptopedia/smart-contract-examples-smart-contract-use-cases" target="_blank" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://www.gemini.com/cryptopedia/smart-contract-examples-smart-contract-use-cases&source=gmail&ust=1694156548371000&usg=AOvVaw1keNlnmikk0VkNDIifxDuQ">https://www.gemini.com/<wbr />cryptopedia/smart-contract-<wbr />examples-smart-contract-use-<wbr />cases</a>.</em></div> <div dir="auto" 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