What Role Does Energy Play in the Execution of Smart Contracts?

Smart contracts are, according to Nick Szabo, the author of the concept, a set of obligations between the parties, expressed through a digital code, which also contains a protocol for the execution of these obligations. In practice, it is a contract (agreement) known to everyone, drawn up on paper. What is the difference? Why do modern business people, especially in the field of cryptocurrency transactions, still prefer these digital technologies?

It should be noted that Szabo's concept in the cryptocurrency sphere received a material embodiment with the development of certain technologies in the creation of networks, namely, with the advent of blockchain, a decentralized platform. It is the decentralization of the system that ensures the consensus of many network nodes, which allows using a virtual machine to create smart contracts.

The attractiveness of a smart contract is explained, firstly, by the absence of an intermediary between the parties, and secondly, by the impossibility of any party violating the obligations. Otherwise, the smart contract will be cancelled. That is, the problem of trust is completely removed: the smart contract will either be fully executed, or the transaction will not take place.

This is facilitated by the deterministic program itself, which will perform certain actions specified by the algorithm, consisting of conditions like "if ... then ..." So calling these contracts "smart" or "intelligent" is a tribute to creativity and romance. In fact, this is just computer code that can be written in different programming languages. For example, Ethereum, Tron and several other popular cryptocurrency blockchains use the high-level language Solidity to write smart contract code. In previous publications, we have already said that Tron's developments borrow heavily from Ethereum. This benefits both platforms, since the compatibility of token standards allows scaling the blockchain and expanding the user audience of both ecosystems.

Tron uses TRC-20 tokens to create smart contracts. Any DApps decentralized application is a smart contract, and more complex applications are a package of smart contracts combined with a developer or user interface.

Each smart contract can contain a number of transactions: transfer of funds in cryptocurrency, transfer of information, which is the smart contract itself, other assets, etc.

for conducting transactions in the Tron network. To pay for it, you can use the native cryptocurrency in the form of TRX tokens, as well as special resources that compensate for the provision of traffic and computing power for smart contract transactions.

Since the Bandwidth resource, which is updated daily and is free for users, is used to compensate for the provided traffic, we only mention it in this article.

The main resource that is designed to compensate for the network's computing power spent on working with a smart contract is Energy. And this resource must be purchased for native crypto. Or use the special features provided by the Tron blockchain platform to reduce transaction costs or even receive Energy for free. More on this below.

Key Roles of Energy in Smart Contract Execution

Let's take a closer look at the role that the Energy resource plays in the Tron system in general and in the development or use of smart contracts in particular.

Payment for Computing Resources

One of the main purposes of Energy, as mentioned above, is payment for computing power. After all, the creation, use, storage and automated control of smart contracts require certain computing processes in the blocks or nodes of the ecosystem. These computing resources are not restored by the blockchain platform. They are compensated precisely by the return of a certain amount of the Energy resource by the developer or users of the smart contract.

As we have already said, smart contracts can have different levels of complexity. Some are limited to one or two transactions. But if we are talking about decentralized applications, then this can be a whole package of smart contracts with a large number of transactions. Of course, more complex smart contracts will require more "fuel" in the form of Energy.

Minimizing Transaction Costs

If the developer or user runs out of Energy when working with smart contracts and the transaction is not yet completed, the network will take your TRX, if any. Moreover, this is done without warning about the transition of payment for transactions from Energy to crypto tokens. Therefore, you should monitor the volumes of Energy and carefully calculate the consumption of this resource in upcoming interactions with smart contracts.

Proper use of resources Tron , as well as the opportunities that the platform provides, allows you to significantly reduce transaction costs, or even reduce commissions to zero. After all, if you can ensure interaction with smart contracts with a sufficient amount of Energy, you will not have to spend crypto and pay a commission in TRX.

But why are we talking about free transactions, because you still have to pay for them with Energy . Yes, you will have to, but the whole trick is that the Energy resource itself can be obtained in the Tron network for free. More on that below. This opportunity will be especially interesting for those who take orders for the development of smart contracts, or active users who constantly interact with DApps - decentralized applications of varying levels of complexity.

Saving on Large and Complex Contracts

By using Tron resources correctly, you can save on complex smart contract transactions. Less complex smart contracts, which are limited to 1-2 transactions, can concern simple actions with your finances - transferring crypto to another user of the same network or withdrawing it outside the network. Just read the terms of transfers within the blockchain and other types of transactions, as well as the conditions for their execution - you will surely find a way to save TRX.

A more complex smart contract will require significant cryptocurrency fees. This is where your Energy savings will come in handy, because instead of TRX you will be able to pay with the resource to compensate for the costs of the network's computing power.

Automatic Execution of Contracts

Another reason why you should have a reserve of Energy not only for developing a smart contract, but also for interacting with it until its completion, that is, for all the transactions embedded in it.

Tron eco-platform pays for all operations embedded in the smart contract with the Energy resource. If it is insufficient at any stage of development or any type of interaction, further execution of the smart contract can be stopped up to its cancellation if the network cannot continue to pay for transactions either with the resource or with native crypto in the form of TRX tokens.

Distribution of Resources Between Users

So we have come to one of the most interesting topics for those who want to save on transactions when interacting with smart contracts.

To get the Energy resource for free, you can use passive or active staking. This is one of the ways to get crypto in the blockchain, which, unlike mining, does not require expensive equipment and significant electricity supplies. In light of recent trends, the environmentally friendly way of "mining" cryptocurrency has been received with enthusiasm. Okay, in fact, the reason for the enthusiasm is that you do not have to spend money on fancy video cards, look for a source of cheap electricity, or master complex mining skills.

On the Tron blockchain, crypto and resources are mined with much less effort and money.

We have already mentioned that one type of resource is restored daily - Bandwidth, which compensates for the use of network traffic during transactions. This resource is credited to each Tron network account in a certain amount daily.

But there are active users for whom this constantly replenished quota is sometimes not enough. What can we say about those who deal with smart contracts and need a resource such as Energy, without which it is impossible to interact even with the simplest smart contracts and decentralized applications (DApps). Where can you get the missing resources? Can you buy them for TRX? Well, if you have TRX, then you can use tokens more rationally.

Staking is a system of decentralized resource distribution between users of the Tron network. It is based on the temporary refusal to use your crypto. This process is called freezing.

You freeze part of your TRX tokens or all of your savings in the native Tronix currency for a certain period. During this period, your tokens will be used by the network, and you will have no access to them. Don't worry, they will remain on your balance and in the same amount, without any deductions. On the contrary, you will be credited with certain percentages in TRX, Energy or Bandwidth.

Of course, to accrue significant annual contributions to the freeze, the contribution must also be significant. But the resources as gratitude for helping the platform can be quite decent. Everything depends on the number of tokens and the period of their blocking.

But that's not all - this is the so-called passive staking method. If you freeze tokens regularly, you may be asked to take part in voting. This method selects delegates from a block cluster (validator), who will carry out the will of their voters. There are 27 validators , they are elected every 6 hours and participate in updating the block chain, checking transactions and adding new blocks. They have a number of other responsibilities, but now we are interested in the opportunity to get your additional share of Energy so as not to take risks when interacting with smart contracts.

You pour your frozen tokens into the common "freezer" of all voters. There are several levels of user career up to the super representative level (they are the 27 participants who perform validation). For their work, validators (this is the name of both the block cluster and the participants performing validation) receive a fixed reward in TRX. And the participants of the cluster, in accordance with the tokens invested in the freeze, receive their share of Energy. There may be a preliminary agreement, according to which the validators reward everyone who participated in the elections with their share of TRX tokens for their support. After all, participation in the elections of super representatives is determined by the volume of crypto sent to the freeze. In this case, you have the opportunity to receive both resources and tokens of the native cryptocurrency.

By using the resource allocation capabilities of the Tron network, you can constantly replenish your Energy supply, reducing transaction fees to a minimum or even zero, since you will not be spending your TRX to buy it.

As a result, using the capabilities of staking, you will not be limited in creating smart contracts.

As a result, we can conclude that Energy is an extremely important resource in the Tron network, which allows you to develop and interact with smart contracts. The eco-platform has a system of resource distribution among participants that allows you to accumulate Energy without spending the main cryptocurrency. That is, using the capabilities of active and passive staking, you can accumulate such a quantity of this resource for free that you will not have problems with the commission for computing power when working with smart contracts.