What is a smart contract?

A program stored on a chain that anybody can call and nobody can quietly change. Not a contract, and not necessarily smart.

It is code deployed to a network, sitting at its own address. Anyone can call it, everyone sees the same result, and it does exactly what it was written to do — which is the useful part and the dangerous part in one sentence.

There is no judge and no intent. If the code contains a mistake, the mistake is the rule. Hundreds of millions have been lost to flaws that would be a footnote in ordinary software.

Two things are worth checking before trusting one with money: whether it has been audited by somebody named, and what powers the author kept for themselves. A contract can permit its owner to mint more, freeze balances or block selling, and all of that is readable on the chain before you buy.

Checking a token contract shows how, and approval explains the permission you grant when you interact with one.

Last checked 19 Oct 2026.