2.1.0. First Component – Smartchain
Now imagine, instead of Charis acting as the central person that authorizes each transaction, there is a device that can do the job for her. Imagine if this device is impartial, accurate, and fast!
The good news is that such a device is the smartchain. In other words, the smart contracts on a blockchain will help Charis run her lending business.
Since it does not require any mechanical or manual handling but is completely automated, the smartchain can perform a better job than Charis can manually. What Charis needs to do is to simply connect her lending application to the smartchain.
Thus, the first component of a decentralized market system is the smartchain. The automated smartchain is what will replace Charis’ manual effort of loan authorization. The smart contracts that are on the blockchain are what guarantee this automation.