How are tokenization and smart contracts different?

Although holdings, participation qualifications, settlement standards, and transaction history can be managed with code and data, actual contracts and legal effects must be linked separately.

A smart contract is a program that runs on a blockchain. It can be composed of status data such as balance, transmission/distribution functions, events notifying execution results, access permission conditions, etc.

In an EVM environment, you deploy developed code and call functions through transactions. Running is subject to gas costs and network conditions, and not everything will happen automatically simply because the time is right.

Rent deposits, crop sales, and asset valuations occur outside the blockchain. This information can be delivered through data connection means such as Oracle and used in accordance with the rules established in the contract.

The reliability of external data, deposit of funds, and operator authority must be checked separately. The fact that it is written in code is different from the judgment that the input information is true.

There is a difference between the characteristic of executing in a predictable manner for the same states and inputs and the absence of errors in a program. Risks can arise from bugs, permission settings, upgrade structures, and external dependencies.

Code that runs automatically may also have design and implementation errors. Smart contracts do not replace securing legal rights and managing real assets.

AI can be used to analyze data and find abnormalities, and smart contracts are responsible for execution according to set conditions and authority. Whether analysis results can be directly linked to automatic execution is a separate design issue.

Tokens, code, data, legal agreements and operational responsibilities must be read together to understand how RWA works.