An Executable Distributed Code Contract is an electronic agreement that works on the Ethereum blockchain.
It is termed “distributed code” because it is a set of instructions (code) distributed throughout the entire Ethereum platform (itself a decentralized distributed ledger). This distributed code is executable because it has the necessary agency to perform functions on the blockchain when the correct prerequisites or inputs are met.
Because EDCCs are designed to be responsive to triggers from stimuli within the Ethereum ecosystem (for example, an EDCC that transfers ownership of property to children when they come of age, or an EDCC that changes a company’s insurance rates when the system registers that it has hired twenty new employees), EDCCs are often termed “Smart Contracts.” They’re thought of as contracts because they contain instructions that command “if X factor is met, then make event Y happen.” It’s a functional agreement. The “smart” distinction comes from the fact that the EDCC is executable and swings into action to either cause a transaction or exchange of information on the blockchain. It’s not an inert statement on a piece of paper.
“Smart” is a bit of a misnomer, however. Like a computer, ECDDs can perform very advanced functions, but also like a computer, EDCCs cannot think. They only perform the tasks they are programmed to perform.
EDCCs can simplify people’s lives as well as business functions and the jobs of many governments, agencies, and corporations. They are, in essence, agreements that can be used for nearly any kind of situation. Examples include transferring car titles or property values, managing marriage and divorce agreements, placing bets in fantasy sports leagues, managing payments on student loans and more. Within the “world computer” of Ethereum, EDCCs are the instructive code that comprise its programs. Within the “world computer” of Ethereum, EDCCs provide the logic for computational processes.
To learn more about the programs and utilities that can run on Ethereum, read more about Dapps.