Smart Contracts are about the execution of a credible transactions without third parties. 

A Smart Contract is code which automates the “if this happens then do that” part of traditional contracts. The code is replicated on many computers: distributed/decentralised using a technology called Blockchain – a form of distributed, unalterable ledger. 

The main application for Blockchain is crypto currency such as Bitcoin.

A decentralised distributed ledger designed to solve the double spend problem associated with digital money, but is also applicable to: 

• Digital Identity  
• Records  
• Securities  
• Trade Finance  
• Derivatives  
• Financial Data Recording  
• Mortgages  
• Land Title Recording  
• Supply Chain  
• Auto Insurance  
• Clinical Trials  
• Wills

In crypto currency, Blockchain is provides a consensus mechanism for transactions.

Figure 17. How Blockchain works