A software embedded in a blockchain that runs when predetermined conditions are met is the nature of a smart contract. It automates the execution of an agreement that eliminates the intervention of any third party. It also automates the workflow, stimulating the next action when conditions are met.

To make a smart contract , the contracting parties negotiate the terms of the contract. Later these are memorialised, either in part or in full. It becomes the smart contract code which is stored inside the blockchain.

The contract is performed — dependable transactions are made without the intervening intermediaries. It is a decentralised method. The code governs the performance of the contract. The transactions are trackable and reversible.

Smart contracts are vulnerable to hacking. They could be infected. There is audit of smart contracts to identify the risks. There are smart contract audit companies. In this audit, the code is examined and analysed. Its aim is to discover errors, issues and security risks in the code. Improvements are suggested. There are suggestions to fix the bugs and errors.