Smart Contracts and Blockchain Policy Compliance Research Guide

Smart Contracts and Blockchain Policy Compliance Research Guide

Glossary

Term DefinitionsBlockchainA distributed ledger technology that uses cryptography to link blocks of data together to form an immutable record.Smart ContractA self-executing contract stored on a blockchain whose terms are written directly into the code.Distributed LedgerA database that is shared, replicated, and synchronized between multiple participants.NodeA participant in a blockchain network that can verify transactions, maintain a copy of the ledger, or execute smart contracts.MinerA node responsible for adding new blocks to the blockchain, validating transactions and earning rewards by solving complex computational puzzles.VerifierA node that checks the validity of transactions on the blockchain to ensure that transactions comply with the blockchain's rules.TransactionAn action performed on a blockchain network, such as transferring assets or executing a smart contract.Transaction PolicyA rule defined by a user that constrains the execution conditions of a smart contract.Compliance CheckerA component that verifies whether a transaction complies with its associated policy. Trusted Execution Environment (TEE) A secure area on a processor that provides an isolated execution environment for code and data, such as Intel SGX.

Short Answer Question

What is a smart contract and how is it different from a traditional contract?

Explain how blockchain nodes maintain the blockchain through mining.

What role does a transaction policy play in ensuring the security of a smart contract?

Describe two forms that can be used to represent a transaction policy.

Why is a compliance checker needed in a blockchain system?

How does a Trusted Execution Environment (TEE) enhance the security of blockchain transactions?

Explain why blockchains are considered trusted even in the absence of a central authority.

Describe the general steps for executing a smart contract in a blockchain network.

Compare and contrast the roles of miners and validators in a blockchain system.

Discuss some challenges of implementing a transaction policy in a blockchain system.

Short Answer Question

A smart contract is a self-executing agreement stored on a blockchain whose terms are written directly into the code. Unlike traditional contracts that require third-party execution, smart contracts execute automatically once the preset conditions are met.

Blockchain nodes mine by solving complex computational problems. Nodes that successfully solve the problem have the right to add new transaction blocks to the blockchain and receive corresponding rewards. This process also verifies transactions and ensures the security of the blockchain.

Transaction policies set clear rules and restrictions for the execution of smart contracts, ensuring that only transactions that comply with the policy can be executed, thereby preventing malicious behavior and unauthorized operations.

Transaction policies can be represented by state machines or domain-specific policy programming languages. State machines describe policies by defining states and transitions, while domain-specific policy programming languages ​​provide more advanced syntax and semantics to define policies.

Compliance checkers are responsible for verifying whether transactions comply with their associated policies. In decentralized blockchain systems, compliance checkers ensure that all transactions comply with predefined rules and maintain the integrity of the system.

Trusted Execution Environment (TEE) provides an isolated execution environment for blockchain transactions, protects code and data from unauthorized access and modification, and enhances the confidentiality and integrity of transactions.

Blockchain ensures credibility through a distributed consensus mechanism. Even if some nodes fail or behave maliciously, as long as most nodes remain honest, the system can remain operational and ensure data accuracy.

The steps of executing smart contracts in a blockchain network include: users submit transactions, nodes verify transactions, miners package transactions into blocks, and add blocks to the blockchain, and finally smart contracts are automatically executed according to the code.

Miners and validators are both important roles in the blockchain network. Miners are responsible for creating new blocks and adding transactions to the blockchain, while validators are responsible for verifying the validity of transactions and the integrity of the blockchain.

The challenges of implementing transaction policies in blockchain systems include: designing a flexible and extensible policy language, ensuring the correctness and security of policies, and efficiently performing policy checks in a decentralized environment.