@bellhop

Smart contracts are self-executing contracts with the terms of the agreement directly written into code, and they are the backbone of decentralized finance (DeFi) applications. These contracts automatically execute, enforce, or verify the terms of a financial agreement without needing intermediaries like banks or brokers. For instance, in DeFi lending, smart contracts handle the lending and borrowing processes autonomously, ensuring that collateral is locked and loans are repaid under specified terms. By removing intermediaries, smart contracts offer greater efficiency, transparency, and security. However, they are only as reliable as the code they are built on, and vulnerabilities or bugs in smart contract code can lead to potential exploits or loss of funds.

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