What is a smart contract?
A program stored on a blockchain that runs exactly as written when its conditions are met, without anyone able to intervene.
Smart contracts allow agreements to be enforced by code rather than by an institution — lending, exchange, escrow and token issuance are all implemented this way. Once deployed, most cannot be altered.
Why it matters: immutability is the feature and the danger. A bug cannot be patched away, and there is no support desk to reverse a loss, which is why exploits routinely drain very large sums in minutes. “The code is the agreement” also means the code is the risk: an audit reduces that risk but does not remove it. See DeFi.
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