Smart Contract Audit – from the perspective of startups

15/09/2018

Florian Protschka

administrator

Smart contracts are part of today’s blockchain world. The obligatory audit of smart contracts is often viewed externally as a compulsion by the investors. Of course, investors want to see that the smart contract meets the highest technical standards. However, the audit is also helpful to the startups themselves, who want to do for example a token sale.

Professional companies who developed a product let review them by an external partner. Whether they have developed a mobile app, an online shop, a whole platform or anything else – a review by an external team is usually done. This process is for their own protection and possibly improvements for the future.

Smart contracts also need this review. Because they replace the external third party in a procedure such as a notary, they have a special and important role in the processes in which they are used. Imagine a worst case scenario: an innovative startup uses a token sale to raise money to make a product a reality. A reputable young company with a serious business idea, which is a solution with a long term value. This startup also manages to convince the community at crowdsale of its own product. So everything is fine. Until it turns out that the smart contract is not secure. Mistakes in development make the whole project fail.
This shows that smart contracts play a fundamental role in token sales. But not only at token sales smart contracts are important; they are among the most important developments in the blockchain area at all. It is important for the smart contract audits that they are made by an experienced company. In the end, the audits never give a 100% security. But the professional review will increase the probability for a secure smart contract.

Startups should definitely let audit their smart contract and they should have the audit done by a professional and reputable company. It’s a good idea to get a certificate after the audit to draw attention to the audit. Private providers of smart contract audits or companies with very low prices (for example, $ 500) should be avoided. The rule is: quality has its price. It makes sense to compare even under different providers.

More about smart contracts can be found here:
Smart Contracts – an introduction
Audit example from Touch social smart contract audit