Are Autonomous Smart Contracts the Future of Blockchain Technology?

Blockchain technology has permeated the modern world and is radically transforming the financial ecosystem.  Inspired by the dream of a decentralized and democratized method of dealing with financial services (to prevent recurrent overexertion and even outright malpractices by centralized financial institutions), blockchain technology has evidently made giant strides over the last couple of decades.

From the creation of digital currencies, to their integration with the blockchain digital ledger (i.e, Bitcoin), to the introduction of smart contracts on blockchains (i.e., Ethereum), to the more recent introduction of decentralized exchanges (DEX) and the proliferation of decentralized applications (Dapps), blockchain technology has come a long way and it seems like it’s here to stay. However, though the dream of completely decentralized finance (DeFi) seems to have become very popular among tech enthusiasts who keep developing this infrastructure, it is yet to be achieved. So, more DeFi innovations are still being developed.

Smart contracts are at the heart of the decentralized finance infrastructure as they manage the execution of transactions on the blockchain. Smart contracts play the important role of interfacing between the business and technological aspects of the blockchain as they are basically financial management protocols written in code format to regulate transactions on a decentralized record system like the blockchain. However, smart contracts on currently available and widely used blockchains like Bitcoin blockchain and Ethereum blockchain, have a centralized management method which limits the current capabilities of blockchain technology.

Currently, smart contracts need to be triggered to function. This means that the smart contract code lies dormant on the blockchain until a specific event (e.g., transactions, update or configuration requests etc.,) are initiated by users of a blockchain and that causes the appropriate smart contract to awaken and execute tasks (i.e., triggering). This reactionary ideology results in blockchains being managed by centralized servers or bots (to coordinate the functioning of users’ requests and smart contracts), and this centralized control limits available blockchains because it makes them less secure and ultimately defeats the purpose of decentralization.

Together with other factors like architecture and consensus protocol (proof of work vs proof of stake), this centralized management of smart contracts results in a well-established problem in blockchain technology known as the trilemma, which basically means that blockchains currently have to sacrifice scalability, security or decentralization in their operation. Several approaches are being explored in an attempt to fix this trilemma issue but a breakthrough has recently been presented with the introduction of autonomous smart contracts on a new blockchain known as Massa blockchain.

Autonomous smart contracts tackle this trilemma issue by being able to operate independently of external triggers, hence minimizing the need for a centralized means of managing them and therefore promoting all three factors of scalability, security and decentralization, instead sacrificing any. This was the main idea behind the development of Massa blockchain by three French scientists who have already released a beta version of the blockchain (testnet) for public access. We further explore autonomous smart contracts and their implications for the future of blockchain technology.

Understanding the Trilemma

Blockchain technology is currently limited by the trilemma, a long-established problem in computer science which involves the restrictions that security, scalability and decentralization place on one another. According to Cryptopedia.com, this problem was first discovered by early computer scientists as the CAP (Consistency, Availability and Partition tolerance) theorem. The CAP theorem describes how decentralized data stores can only guarantee a maximum of two out of those three important features listed i.e., Consistency, Availability and Partition tolerance. Because a blockchain is essentially a decentralized data store, this CAP theorem also applies to it and this is what results in the trilemma.

The established blockchain premise that a public chain will have to choose between scalability, security, and decentralization in its operation is known as the trilemma. For instance, with well-known blockchains like Bitcoin and Ethereum, the tradeoff is mostly between scalability and decentralization. This problem is mostly due to the architecture of existing blockchains which validate on-chain activities using proof-of-work consensus protocol and also in a slow linear, node to node method in Bitcoin. Validation of activities (e.g., transactions) on a blockchain by consulting numerous nodes on the chain (i.e., consensus) is necessary to ensure security and decentralization. An issue then arises as more nodes are added to the blockchain because it takes more time to validate transactions with the nodes, which compromises scalability. However, fixing this problem by validating with fewer nodes will compromise decentralization and security (i.e., hackers can easily trick the few nodes and manipulate the blockchain). Hence, the trilemma.

This already existing problem is further magnified by the centralized management of smart contracts through a server or centralized bots as the server can be hacked, bots can make mistakes, the centralized system has limited scalability and ultimately such centralized control limits the goal of decentralization. This tradeoff between scalability and decentralization in a blockchain is measured using the Nakamoto Decentralization Coefficient (NDC). The concept of autonomous smart contracts was specifically introduced to tackle this problem of decentralization and scalability in existing blockchains. The image below shows that with autonomous smart contracts, Massa blockchain has highly improved decentralization and scalalability when compared to Bitcoin blockchain, Ethereum blockchain and other blockchains.

Hence, the introduction of autonomous smart contracts to solve the trilemma is a major game changer in the decentralization of blockchain technology.

Solving the Trilemma

A number of solutions have been considered on different blockchains, in an attempt to solve the trilemma. Some of them are identified below.

• Bitcoin introduced the lightening network which involves a second layer for off-chain transactions with multiple payment channels.
• Ethereum proposed a dual Proof-of-stake model with an execution layer for smart contracts and a consensus layer for transactions.
• Algorand is reported to have successfully solved the trilemma using its Pure Proof of Stake model
• The massa project is reported to have successfully solved the trilemma using autonomous smart contracts.

Our focus here is on autonomous smart contracts which not only solves the trilemma but presents a new layer of automated decentralization in blockchain technology.

The Massa Project

Beincrypto.com reports that the Massa project was initiated in 2017 by Sébastien Forestier (CEO), Damir Vodenicarevic (development and technology leader) and Adrien Laversanne-Finot (company strategy leader). Their goal was to solve the trilemma by creating autonomous smart contracts.

According to massa.net, the team accomplished this goal by creating a new blockchain (Massa) which combines proof-of-stake consensus (proof-of-stakeconsensus gives paramount consideration to value staked on a blockchain in validating activities) and a multi-threaded blockgraph (facilitates parallel block creation), into an effective new system of blockchain functionality known as the blocklique. Then they developed autonomous smart contacts which are triggered by information stored onchain, and these characteristics enable their blockchain to run thousands of low energy cost operations within a second.

With autonomous smart contracts, the massa project succeeded in promoting decentralization and scalability in blockchains, with Cryptonews.com reporting it to be the first blockchain with up to 1,000 NDC, together with other perks like decentralized web hosting. The testnet phase of Massa blockchain was launched in 2021 and is reported to have successfully attracted over 7000 actively running nodes and crossed a throughput mark of 4,000 transactions per second. The mainnet (the official blockchain), is to be released with improvements on weaknesses in the testnet and targets a throughput of about 10,000 transactions per second. This is a massive step up for blockchain technology.

Smart Contracts Versus Autonomous Smart Contracts

According to TechTarget.com, a smart contract is a decentralized program which executes business logic in response to certain events which trigger it. Smart contracts are generally developed by business professionals and programmers to manage activities like value exchange, service delivery, unlocking of protected content etc., on a decentralized data store like the blockchain. Due to this reactive ideology, smart contracts need continuous management for their operation and existing blockchains rely on centralized systems like a bot network or cloud infrastructure to automate them. However, this centralized management magnifies the trilemma problem.

Due to the obvious problem caused by centralized management of the smart contracts, the Massa team who developed autonomous smart contracts are recorded to have asked this question;

"Why would you advocate for decentralization when you continue relying on obviously centralized means of interacting with your Smart Contracts?"

Hence, they developed the idea of autonomous smart contracts to solve the trilemma issue through a new layer of decentralization. An autonomous smart contract can therefore be defined as a smart contract that doesn’t necessarily require external management for its automation i.e., it is capable of independent execution of a pre-assigned operations on the blockchain. It operates with blockchain data and can also request external information without need of additional management.

Massa blockchain alone, currently has this smart contract functionality. This functionality is achieved through the storage of data alongside transactions and smart contracts on the blockchain. The data can then be accessed at any time by smart contracts for autonomous operation.

Autonomous smart contracts are becoming more recognized in the decentralized finance world. The CEO of Dusa (an Automated Market Maker built with Massa blockchain) has this to say;

"Thanks to the autonomous smart contract and the blockchain hosting of our web application, we are able to offer the first 100% decentralized DeFi experience. Such technological innovations allow us to provide fully autonomous execution of our users' latent trading orders plus optimal liquidation management, all coupled with increased security for our users."

Conclusion

We conclude by analyzing the implications of autonomous smart contracts for the future of the blockchain. Considering how blockchain technology has been developed on an incremental basis, and the massive improvements autonomous smart contracts have been shown to make to blockchains, it is reasonable to state that existing blockchains like Bitcoin and Ethereum may also implement autonomous smart contracts to break loose of the trilemma. Though other methods of tackling the trilemma are available, autonomous smart contracts stand out because in addition to tackling the trilemma, they also promote decentralization which is the fundamental principle for the creation of cryptocurrencies, in an automated way. Hence, while it is impossible to predict the future with certainty, autonomous smart contracts seem like a breakthrough technology which has come to stay, and will transform blockchain technology to a large degree.