What are smart contracts?

Smart contracts are self-executing programmes that run on decentralised networks (like blockchains) & execute automatically based on specific conditions.  They’re changing the world and (sooner or later) you’ll want to deploy some.

Part of the power of permissionless blockchains (and the smart contracts deployed on them) is that they are immutable. Once deployed, smart contract code cannot be changed. That immutability means that we need to think very hard, up-front, about design before we deploy any smart contracts.

Part of those design principles is to ensure that our smart contracts contain the right functions. In some cases, these can allow an appropriate party (e.g. the contract owner) to interact with a live contract, and to change its behaviour.

Some common examples of such functions include:

• Managing allowlists: e.g. prioritising access to new products for high-value customers
• Managing airdrops: e.g. sending rewards to loyal customers
• Updating metadata: e.g. changing the image associated with a token
• Creating, transferring and burning tokens: e.g. as they are earned and spent on your business’ platform
• Updating royalty wallets: Changing the wallet to which your creator royalties are sent
• Withdrawing funds: Accessing the value earned by a smart contract

In order to make the process of interacting with these smart contract functions as efficient as possible for our clients, we’ve created a Smart Contract Management Tool.

This manages security (ensuring that only the appropriate personnel or systems can interact with the contract functions), all via an intuitive UX (or integrated seamlessly into existing user journeys)

You can play with a demo version of our Smart Contract Management Tool here: https://www.min3.xyz/products/smart-contract-management-tool

Why are smart contracts important?

Smart contracts are becoming increasingly important to the economy.  As an example, there is over $99 billion currently locked in DeFi smart contracts. As tangible and intangible assets are increasingly tokenised, the risk associated with unsuitable smart contracts becomes more significant.

As aforementioned, once deployed, smart contracts are immutable (i.e. they cannot be altered). Whilst this characteristic can deliver security and trustlessness, it also means that any flaws or limitations are permanent. Therefore, thoughtful design from the outset is paramount. 

Here at MIN3, we follow these guidelines when developing our contracts:

1. Choosing the Right Blockchain 🌐

Selecting a blockchain involves balancing factors such as security, liquidity & network effects, scalability, and cost. We pick the appropriate chain for each use case

2. Selecting the Appropriate Contract Standard 🛠️

Different applications require different standards for smart contracts. For instance, in the Ethereum ecosystem, there are multiple standards that apply to non-fungible tokens (NFTs) alone. For example: 

• ERC-721A: Optimised for gas efficiency, particularly for minting multiple NFTs in a single transaction
• ERC-721R: Includes a refund mechanism, allowing buyers to return NFTs within a specified period
• ERC-721Enumerable: Extends ERC-721 with functions for enumerating NFTs
• ERC-721Metadata: Adds metadata functions to ERC-721
• ERC-721URIStorage: Provides a method for storing token URIs on-chain
• ERC-721Pausable: Allows contract functionality to be paused
• ERC-721Burnable: Adds the ability to burn (destroy) tokens
• ERC-721Consecutive: Optimizes for minting large numbers of tokens with consecutive IDs
• ERC-721Royalty: Implements on-chain royalties for NFT creators
• ERC-721Holder: A utility contract for receiving ERC-721 tokens
• ERC-1155 allows for both fungible tokens (ERC-20 standard) and non-fungible tokens (like the above) to be deployed in a single contract, useful for games and platforms with multiple token types
• ERC-6551 allows NFTs to function as smart contract wallets (enabling them to store additional tokens, including other NFTs)

3. Optimising Contract Size 📏

Keeping contracts small and lightweight is preferable. Smaller contracts reduce deployment and transaction costs and minimise the attack surface (keeping them safer)

4. Leveraging Standard Libraries 📚

Using open-source, well-established libraries such as OpenZeppelin is best practice. These libraries are widely used and battle-hardened, reducing the risks associated with custom code and increasing security and reliability

5. Prioritising External Audits 🔍

External audits can be essential (particularly where the contracts are high-value, high-risk etc.). By engaging third-party experts (for example, we regularly use - and would recommend - @4ire) to review our smart contracts, we help to ensure they are sufficiently robust

6. Designing for the Future 🔮

The immutability of smart contracts necessitates forward-thinking design. At MIN3, we build with the future in mind, including functions that enable changes to be made by authorised personnel via our Smart Contract Management tools (see the comments for a link to our demo product 👇).  This helps to future-proof our solutions

By adhering to these principles, we strive to deliver smart contracts that are not only efficient, affordable and secure, but also adaptable to future requirements. Thoughtful design is not just a best practice—it’s a necessity.