Smart Contracts: Code that Executes Itself

A simple graphic illustrating the concept of a smart contract

🧭 Lesson Overview: Smart Contracts Explained

This lesson introduces the foundational concept of smart contracts: programs that run on blockchain networks to automatically enforce agreements. Designed for learners new to Web3, this module explains what makes a contract “smart,” how they execute across decentralized nodes, and why immutability, transparency, and trustless automation are core to their value.

You will explore key properties like atomicity, composability, gas constraints, and access control. The lesson demystifies how functions, state variables, and events shape smart contract behavior through practical Solidity examples. We’ll cover real-world use cases, including decentralized finance (DeFi), NFTs, and DAOs.

This lesson also outlines how smart contracts function on different blockchain platforms, introduces common programming languages (Solidity, Vyper, Rust, Move), and highlights typical security vulnerabilities like reentrancy. We’ll conclude by addressing smart contract limitations, such as a lack of native access to external data and complexity in upgrades.

By the end of this lesson, you will have a strong foundation in smart contract development, understanding what they are, how they work, what they enable, and the key risks to be aware of.

📚 Learning Steps: Your Path to Technical Fluency

  1. ✅ Master the Vocabulary: Familiarize yourself with all essential blockchain terms so you can talk confidently about them.

  2. 📖 Go Hands-on: Complete the reading assignment to reinforce your understanding of the core concepts.

  3. 📝 Test Your Knowledge: Take the comprehension quiz to solidify your learning and ensure you're ready for the next lesson.

🧠 Essential Blockchain Vocabulary

Before diving deeper into smart contracts, build your Web3 vocabulary with our essential terms. These definitions and real-world analogies are designed to help you create a mental model of how blockchain concepts work. By mastering this technical terminology, you’ll be better equipped to understand the technologies discussed in this lesson.

Each term has been selected to support your understanding of smart contracts at both a conceptual and practical level.

Atomicity

Blockchain

Composability

dApp

DeFi

DEX

Function

Gas

Gas Fee

Immutable

NFT

Oracle

Proxy Contract

Solidity

Trustless

📘 Challenge Yourself

Ready to go hands-on? Complete the reading assignment to reinforce this lesson's concepts. Then, take the short quiz to test your technical fluency.

📝 Quiz: Test Your Blockchain Knowledge

Ready to put your skills to the test? Take this short quiz to test your understanding of the lesson's core concepts. Solidify your knowledge before moving on to the next topic in your learning path.

1. What does 'trustless' mean in the context of smart contracts?

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