Smart contracts utilize blockchain technology for automation. These self-executing contracts with the terms of the agreement directly written into code enable secure, transparent, and tamper-proof transactions without the need for intermediaries. The decentralized nature of blockchain ensures that the execution and verification of the contract are carried out by the network itself. This automation reduces costs, improves efficiency, and minimizes the potential for disputes, making smart contracts ideal for various applications, including finance, supply chain, and property transactions.