Solidity, Blockchain, and Smart Contract Course (Article # 02)

Solidity, Blockchain, and Smart Contract Course

Solidity developers now since its inception the ethereum protocol has given rise to many new paradigms and industries including d5 nfts dows or decentralized autonomous organizations layer twos and so much more and a couple of other protocols have taken this ethereum vision and gone in a different direction with it like polygon polka dot or avalanche if we learn the core basics of smart contract development on the ethereum platform all these skills translate to these other chains as well so don't worry about learning a specific tool or chain because most of them work together pretty seamlessly now there are a few exceptions to this rule and there are some smart contract platforms aka blockchains that don't use solidity however learning the fundamental skills here will still translate to every single other blockchain and ethereum is by far the most popular and most used smart contract blockchain or smart contract protocol you'll also hear those words used a little interchangeably as well sometimes i'll say blockchain or sometimes i'll say smart contract platform smart contract protocol. and the like similarly chain link is the most popular and powerful decentralized oracle network and is going to be the one that we're going to focus on here chain link is also blockchain and smart contract platform agnostic meaning it'll work on ethereum avalanche polygon polka or really any blockchain or smart contract platform out there even in this introduction we've already learned a lot so let's do a quick summary of what we've talked about bitcoin was the first application to take the blockchain technology into the limelight and into a meaningful way bitcoin is a sort of digital gold able to make transactions between users as almost a sort of currency ethereum takes this blockchain technology one step further but you can also build smart contract or decentralized applications decentralized autonomous organizations and more because you can code with smart contracts these smart contracts can then access external data and external computation outside the blockchain using what's called oracles chain.

Solidity, Blockchain, and Smart Contract Course

Link is the most powerful decentralized oracle network and allows us to build these hybrid smart contracts which is a combination of decentralized on-chain logic settlement layer and any decentralized external off-chain data or computation hybrid smart contracts and smart contracts are often used interchangeably now you're probably asking yourself a lot of questions right now like what makes bitcoin so interesting what makes it like a digital gold and how are these smart contracts. 

Going to add any value to the real world and that's what we're going to go into now so before we get into the nitty-gritty of how these blockchains and how these smart contracts actually work from a low level let's go high level and talk about some of the features and massive advantages that blockchains and smart contracts have over our traditional environments the first feature that these have is they are decentralized and you'll hear this term used a lot because it has a massive benefit blockchains are decentralized meaning there's no centralized source that controls the blockchain the individuals.

That make up blockchain are known as node operators and they are the independent individuals running the software that connects the whole blockchain together it's all these different independent individuals that make the blockchain and blockchain like networks decentralized we'll dive deeper into that concept later great example of why this is so fundamentally groundbreaking is if we go back to what happened recently even with robinhood and gamestop gamestop shares were no longer allowed to be bought because a centralized entity didn't want them to be bought anymore so they flipped a switch and nobody could buy that stock anymore essentially having a single entity controlling. 

The entire financial market the fact that a single entity has the power to make these choices for us is a travesty and blockchain is here to solve that there's a narrative here called the bankless narrative where users can actually live in a world where they don't have a bank banks while good in their own right have a history of doing some shady things they also have the power to potentially freeze your funds not letting you withdraw or move or do anything because they are a centralized entity that again can flip a switch and control how you interact with your life every day being free of these centralized entities have this much power and this much control over your life has widespread positive ramifications transparency and flexibility everything. 

That's done on a blockchain and all the rules that are made can be seen by everyone there's no backdoor deals there's no shady happenings everything that happens on chain you can see this means that there's no special information that a few have everyone has to play by the same rules and everyone can see exactly what those rules are now additionally this doesn't mean that everything you do is tracked the blockchain is pseudo-anonymous so you can create different accounts and you can interact with it in many different ways this leads me to my freedom point. 

But I'll get there in a second speed and efficiency have you ever tried to make a withdrawal from the bank and it took three to five days all the bank is doing is adding and subtracting numbers basic first grade math so why does it take so long because blockchains are verified by a decentralized collective the settlement or withdrawal period in this case is substantially faster and depending on the blockchain that you're using it can  be from 10 minutes all the way down to just a couple of seconds in the stock trading or hedge fund world it can actually take up to a week for your buy or sell of a stock to go through security and immutability blockchains are immutable which means they can't be changed and because of this it means that they can't be tampered with or corrupted in any way shape or form this allows us to have massive security on our data on our transactions and anything of the like if your computer goes down and your backup computers go down in the regular world your data is gone if all your data is on those two computers you're out of luck on a blockchain if several nodes go down it doesn't matter because as long as one node and the entire system is running the data is safe and secure there are thousands or hundreds of thousands of nodes running these blockchain softwares.

Meaning that everything that happens and is immutable and won't change hacking the blockchain is nearly impossible and substantially harder than hacking a centralized entity and this is also much more secure in the asset sense as well instead of having gold in a vault or contract written on a piece of paper or on your computer you have a asset that is locked on the blockchain forever and all you need to do to access it is have a private key or mnemonic which is essentially a password so you don't have to lug your gold around or lug your contracts around with you it is always on the blockchain smart contracts in particular remove a massive conflict of interest in the traditional world when we engage with users or individuals they don't always have our best interests at heart a lot of them are usually self-motivated in some sense and there's nothing wrong with that that's how a lot of people are however when we make an agreement with them this agreement can have a massive conflict of interest with the user who's

supposed to execute that agreement let's take insurance for example if i pay an insurance provider 100 a month. i'm paying them a hundred dollars and in the event that i get hit by a bus we've made an agreement or a contract that. they're going to pay my medical bills or bail me out however they have this massive conflict of interest insurance. companies aren't in the business of giving out money they're in the business of making money so even though they've signed this agreement when this event occurs they still don't want to pay this money out to me and if they can find a loophole in the contract they will because that is what they are motivated to do so they sign this agreement but it's not in their best interest. to do so so they have this massive conflict of interest and this is native in all of the agreements that we make today they are the ones who decides whether or not they're going to execute their agreement giving execution power to the party that doesn't want to execute something has often led to frustration now the follow-up is you can always sue them and go through this process.