A recent study by PwC suggests that smart contracts are gaining traction in the financial industry and are expected to become the standard in the long run. The study reveals that 52% of IT decision-makers in the financial sector have plans to implement smart contracts in the near future.
Furthermore, over a third of the respondents believe that smart contracts will eventually replace traditional financial transactions altogether. The advantages offered by smart contracts, such as streamlined and efficient business processes, cost savings through automated execution and monitoring, and the ability to swiftly adjust rates or clauses with the aid of AI, make them an appealing alternative.
IT decision-makers expressed a high level of confidence in the reliability (95%) and the benefits of cybersecurity and transparency (95%) provided by smart contracts. They also recognized their potential to boost sales (84%), generate cost savings (53%), and contribute to sustainability goals (74%).
Currently, smart contracts are primarily utilized in the financial sector for digitizing transaction networks, exploring new digital business models, and facilitating peer-to-peer payments. Many respondents have future plans to combine smart contracts with AI and incorporate them into sustainable or decentralized finance initiatives.
Despite the growing interest, there are barriers to the widespread adoption of smart contracts. The survey indicates that only 19% of service providers currently employ smart contracts, primarily due to a scarcity of experts capable of implementing these complex applications and integrating them into existing business processes. Concerns regarding legal security and data protection also pose obstacles.
However, the study suggests that technological solutions such as zero-knowledge proofs integrated into blockchain platforms can help address these concerns and ensure compliance with data protection regulations. As the advantages of smart contracts continue to be recognized and these challenges are overcome, the study predicts that smart contracts will ultimately replace traditional contracts in various industries, revolutionizing the way transactions are conducted.
