TY - GEN
T1 - Readiness and Potential Application of Smart Contracts in the Indonesian Construction Industry
AU - Wulandary, Kartika
AU - Panuwatwanich, Kriengsak
AU - Henry, Michael
N1 - Publisher Copyright:
© 2023, The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd.
PY - 2023
Y1 - 2023
N2 - A construction project requires a contract to run safely by minimizing costs, schedules and maintaining project quality. In traditional contracts, contractual transactions between trustless parties are generally conducted in a centralized form, requiring a trusted third party to act as witnesses and make them legally binding, enforceable, and trustworthy. However, involving third parties is associated with high costs and delays. In this case, Smart Contracts can be a solution. A smart contract is a code that contains rules that will execute a transaction itself according to the agreement of two parties. Smart Contracts contained in Blockchain Technology have received much attention globally, including in the construction industry. Smart Contracts can enable automatic payments without delays, hassles and without third parties (mediators) carried out in a decentralized network to ensure integrity and transparency by preventing the potential of record manipulation existed in traditional contracts. This paper presents an overview of the potential application of Smart Contracts in Indonesian construction industry. This paper was prepared based on a literature review of several existing studies to obtain data related to the current state of Blockchain Technology, technological readiness, and the potential areas that Smart Contracts can be applied. It is hoped that the findings from the literature review will explain various aspects of the potential for adopting Smart Contracts in the construction industry and can assist in the development of further research that will focus on the application of Smart Contracts in the Indonesian construction industry.
AB - A construction project requires a contract to run safely by minimizing costs, schedules and maintaining project quality. In traditional contracts, contractual transactions between trustless parties are generally conducted in a centralized form, requiring a trusted third party to act as witnesses and make them legally binding, enforceable, and trustworthy. However, involving third parties is associated with high costs and delays. In this case, Smart Contracts can be a solution. A smart contract is a code that contains rules that will execute a transaction itself according to the agreement of two parties. Smart Contracts contained in Blockchain Technology have received much attention globally, including in the construction industry. Smart Contracts can enable automatic payments without delays, hassles and without third parties (mediators) carried out in a decentralized network to ensure integrity and transparency by preventing the potential of record manipulation existed in traditional contracts. This paper presents an overview of the potential application of Smart Contracts in Indonesian construction industry. This paper was prepared based on a literature review of several existing studies to obtain data related to the current state of Blockchain Technology, technological readiness, and the potential areas that Smart Contracts can be applied. It is hoped that the findings from the literature review will explain various aspects of the potential for adopting Smart Contracts in the construction industry and can assist in the development of further research that will focus on the application of Smart Contracts in the Indonesian construction industry.
KW - Blockchain
KW - Construction industry
KW - Indonesia
KW - Readiness
KW - Smart Contracts
UR - http://www.scopus.com/inward/record.url?scp=85151122307&partnerID=8YFLogxK
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U2 - 10.1007/978-981-19-7331-4_21
DO - 10.1007/978-981-19-7331-4_21
M3 - Conference contribution
AN - SCOPUS:85151122307
SN - 9789811973307
T3 - Lecture Notes in Civil Engineering
SP - 249
EP - 263
BT - Proceedings of The 17th East Asian-Pacific Conference on Structural Engineering and Construction, 2022 - EASEC-17
A2 - Geng, Guoqing
A2 - Qian, Xudong
A2 - Poh, Leong Hien
A2 - Pang, Sze Dai
PB - Springer Science and Business Media Deutschland GmbH
T2 - 17th East Asian-Pacific Conference on Structural Engineering and Construction, EASEC-17 2022
Y2 - 27 June 2022 through 30 June 2022
ER -