According to a recent PwC study, smart contracts are poised to become the norm in the financial industry, given their efficiency, cost-effectiveness, and ease of management owing to AI.
The study, which surveyed IT decision-makers in the finance sector, revealed that 52% plan to incorporate smart contracts in the near future. More than a third of these respondents anticipate smart contracts to entirely replace conventional financial transactions.
Smart contracts offer several compelling advantages. They can expedite and optimize business processes, result in significant cost savings due to automated execution and monitoring, and swiftly adjust rates or clauses with AI assistance.
An overwhelming 95% of the IT decision-makers polled expressed faith in the reliability, cybersecurity, and transparency of smart contracts. They underscored the potential of smart contracts to boost sales (84%), reduce costs (53%), and fulfill sustainability objectives (74%).
Presently, smart contracts see the most use in digitizing transaction networks, enabling new digital business models, and facilitating peer-to-peer payments. Several respondents also expressed intentions to merge smart contracts with AI and apply them in sustainable or decentralized finance realms.
Despite these advantages, the adoption of smart contracts faces obstacles. A scant 19% of the service providers surveyed currently employ smart contracts. This is primarily due to a shortage of specialists who can integrate these intricate applications into business processes. Concerns regarding legal safety and data protection also pose significant barriers.
However, technological innovations like zero-knowledge proofs, when integrated into blockchain platforms, can ensure compliance with data protection regulations. This may pave the way for increased adoption of smart contracts in the future.
