Blockchain technology, which powers cryptocurrencies like Ether (ETH), is growing in popularity and is being used for a variety of applications beyond digital currencies. However, managing these systems, ensuring they comply with regulations, and keeping them secure can be challenging.

The team at PARSIQ, a blockchain data startup, recently introduced a new technology called Reactive Smart Contracts (RSCs) that can help with these issues. RSCs are designed to improve the efficiency, security, and compliance of blockchain operations by automating many processes that traditionally require manual intervention.

According to Daniil Romazanov, CTO of PARSIQ, “Reactive smart contracts represent a significant step forward in blockchain technology, enabling seamless automation and improving security across multiple blockchain networks.”

What are smart contracts?

A smart contract is a self-executing agreement written in code that automatically enforces and executes the terms of a contract when certain conditions are met. Think of it like a digital vending machine: you put money in, select your item, and the machine automatically delivers it without human intervention.

Traditional smart contracts operate on a single blockchain, such as Ethereum, and rely on users to initiate actions. They are used in a variety of applications, such as automating payments, creating decentralized applications (dApps), and managing digital assets.

Reactive Smart Contracts — an integral part of Reactive Network — are an advanced type of smart contract introduced by the PARSIQ development team. Unlike traditional smart contracts that require user-initiated actions, RSCs can automatically react to events and data from multiple blockchains. This capability enables RSCs to perform actions across different blockchain networks in real time.

The technology behind Reactive Network includes a specialized execution layer called ReactVM, which supports parallel processing of transactions. This setup makes performing complex operations, such as automated governance and compliance checks, faster and more cost-effective.

Automated governance: improving efficiency and safety

Imagine that every vending machine in a city is controlled by a committee that votes on what products should be available. Traditionally, after a vote, an administrator must visit each machine to update the inventory. This process can be slow, error-prone, and insecure if the administrator’s credentials are compromised.

RSCs allow the “vending machines” to automatically update their inventory based on the committee’s votes, without an administrator having to visit each machine. Here’s how it works:

• Voting Process: The committee members vote on which items should be available in the vending machines. This vote is recorded on the blockchain.
• Automatic execution: Once the vote reaches the required threshold, the RSC automatically detects this event and activates the update on all vending machines.
• Real-time updates: Each vending machine (acting as a node in the network) receives the update in real-time and adjusts the inventory accordingly.
• Compliance Checks: The RSC also ensures that updates comply with local regulations, such as disallowing certain products in specific areas. If a non-compliant product is approved, the RSC blocks that update for the relevant machines.

As blockchain projects grow, they often operate on multiple blockchains. Coordinating governance across these disparate platforms can be challenging. Governance contracts on blockchains like Ethereum and Polygon often operate independently of each other, leading to inconsistencies and delays.

RSCs synchronize governance actions across multiple blockchains. They automatically update vote counts and trigger corresponding processes across chains, ensuring smooth and consistent governance. This reduces delays and discrepancies, improving the efficiency and security of multi-chain projects.

RSCs offer several cybersecurity benefits:

• Minimal human error: By automating processes, you reduce the risk of errors that often occur with manual actions.
• Decentralized Execution: By removing central points of control, the system becomes less vulnerable to targeted attacks.
• Real-time implementation: Instant execution of decisions reduces the chance of potential cyber attacks.
• Improved data integrity: Consistent data across all chains improves the reliability and credibility of blockchain systems.

Reactive Network’s RSCs represent a significant advancement in blockchain governance and compliance. By automating processes and ensuring consistent data across multiple blockchains, they improve efficiency and strengthen cybersecurity. Adopting automated solutions like RSCs will be crucial to developing secure and reliable decentralized systems as blockchain technology evolves.

From a programming language standpoint, there is no fundamental difference between regular smart contracts and reactive smart contracts, as both are written in Solidity. To develop a reactive application, developers simply need to create additional smart contracts that leverage these reactive capabilities.

For those looking to further explore the possibilities of reactive smart contracts, Reactive Network offers a rewards program to incentivize innovation and implementation of these technologies.