A smart contract is a computer program or protocol that is used to facilitate, verify, and enforce the performance of contractual agreements between parties. It uses blockchain technology to ensure that all parties are able to trust each other and to reduce the risk of fraud. Smart contracts are self-executing and self-enforcing, meaning that once the terms of an agreement are set and verified by all parties, they cannot be changed or altered in any way. The program code contains all the rules and conditions of the agreement, so if one party fails to fulfill the agreed-upon obligations, the program will automatically block it from moving ahead. This makes smart contracts secure, transparent, and immutable.