Smart Contracts in Construction Industry

Date

2018-11-16

Author

Salar, Ahmadisheykhsarmast
Sönmez, Rifat

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In construction industry, business failures are generally resulted in payments withheld or refused to be paid. By taking advantage of blockchain technology, cryptocurrencies and smart contracts in this industry such problems could be mitigated. Within the proposed framework, funding of each item of the contract is blocked unless the contractual conditions agreed upon are fully satisfied. Set of instructions and conditions could be coded in smart contracts such that payment will be made automatically only when the stipulated conditions are reached. This concept guarantees establishing a trustful chain of payments between the parties. Proposed concept also minimizes the time-cost overruns due to dispute reduction and maximize the trust between contract parties in construction industry. Although the construction industry is recalled as being slow at adapting to new technologies, the prospect of having a protection against late payments might be a driving force for acquiring the smart contracts. The proposed framework is and pros as well as cons of this framework is discussed in this study

Subject Keywords

Automated construction, Blockchain, Construction contracts, Smart contracts

URI

http://pcmc2018.ciu.edu.tr/index.php/ipcmc-2018-proceedings/
https://hdl.handle.net/11511/72967

Conference Name

The 5th International Project and Construction Management Conference 2018 (16 - 18 Kasım 2018)

Collections

Department of Civil Engineering, Conference / Seminar

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Citation Formats

A. Salar and R. Sönmez, “Smart Contracts in Construction Industry,” North Cyprus, 2018, p. 767, Accessed: 00, 2021. [Online]. Available: http://pcmc2018.ciu.edu.tr/index.php/ipcmc-2018-proceedings/.