What Is a Smart Contract?
A smart contract is code deployed to a blockchain that executes exactly as written when its conditions are met, with no party able to alter the outcome after the fact. It can hold and move assets, enforce rules, and compose with other contracts. It cannot by itself read anything off-chain — for external data it depends on an oracle — and a bug is permanent, which is why audits and upgrade patterns are central to how they are built.
Determinism is the feature and the constraint
A smart contract must be deterministic so every node computes the same result, which is exactly why it cannot reach out to the network for data on its own — that would make the result depend on when and where it ran. Oracles exist to feed it the outside world under that constraint.
For agents, a contract is the piece that makes an agreement self-enforcing: once the terms are code, neither counterparty can renege, which removes a whole class of trust from machine-to-machine commerce.
Related standards
Questions
Are smart contracts legally binding contracts?
Not inherently. They enforce logic automatically; whether they also constitute a legal contract depends on jurisdiction and intent.
Can a smart contract be changed?
Not directly — but developers use upgrade patterns (proxies) to point to new code, which itself must be governed carefully.
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By Michael Gord · published 2026-10-09 · part of the Agentic Encyclopedia. Dates are the day of publication; events are cited at their own dates.