A key component of blockchain technology, smart contracts, have caught the eye of LabCFTC, which have subsequently released a guideline for them.
Disruptive technology can be confusing and concerning for some. Stepping into the great unknown can be scary and trepidation is only natural. However, it is essential that businesses and even average people move in the same direction as the technological evolution or else they’ll get left behind.
As cryptocurrencies and blockchain continue to gain interest and adoption, most authorities are also exploring more ways to make this industry safer for consumers while trying to integrate it into their own systems. This is especially true for distributed ledger technology (DLT). From cross-border payments to streamlining outdated processes, DLT seems to be a viable solution for many businesses.
Bridging the Gap
A revolutionary by-product of blockchain technology is the smart contract. These self-executing contracts conclude once certain pre-determined conditions are successfully met. This has the potential to drastically decrease the time spent on paper processes, which, in turn, can increase efficiency. However, the public needs to know about it in order to successfully utilize it. This is where LabCFTC comes in.
The platform, which is part a part of the U.S. Commodity Futures Trading Commission, was created in May last year to foster responsible FinTech innovation and development in the country. It appears to act as a bridge between these innovators and the CFTC themselves by making the commission more accessible to entrepreneurs while also assisting the commission in understanding the strides that are being made in this field.
Recently, LabCFTC developed and launched “A CFTC Primer on Smart Contracts.” According to a press release, this document aims to serve as an initial guideline on what smart contracts can do, their applications, and their advantages and disadvantages.
LabCFTC Breaks Down Smart Contracts
The Director of LabCFTC explained:
Smart contracts are being used to drive further automation in our markets and may have an impact across a range of economic activities. This primer is focused on explaining smart contracts, exploring how they may impact our markets and highlighting potentially novel risks and challenges.
While discussing potential risks, the primer also details how the CFTC can assist with mitigating them for the safety and convenience of the end user.
Live Bitcoin News has previously reported on risks associated with smart contract exploitation. EOSBet Dice was one such victim, losing about 44,000 EOS in one hack. Smart contract auditing has been put forward as a solution to help combat these instances by ensuring that vulnerabilities are identified and treated.
Have you had a look at the primer? Do you agree with the views of LabCFTC? Let us know in the comments below!
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