On-chain validator scripts in Cardano are part of the smart contract functionality within the network. These scripts are small programs that run directly on the Cardano blockchain, responsible for validating specific conditions or rules when a transaction is processed.
Here’s how they work:
- On-Chain Execution: Validator scripts are stored and executed on the Cardano blockchain itself (hence, “on-chain”). They control how funds are locked and released in a smart contract. For instance, they might specify that certain conditions must be met before funds can be transferred, such as signatures from multiple parties or a specific date being reached.
- Plutus Smart Contracts: In Cardano, these validator scripts are written in a language called Plutus, which is based on Haskell. Plutus allows developers to write complex conditions and logic that govern how the blockchain interacts with smart contracts.
- Validation Process: When a transaction involving a smart contract is submitted, the validator script checks whether the transaction meets the pre-defined conditions. If all conditions are satisfied, the transaction is considered valid, and the transfer occurs. If not, the transaction fails.
- UTxO Model: Cardano uses an extended version of Bitcoin’s UTxO (Unspent Transaction Output) model, called eUTxO (Extended UTxO). In this model, validator scripts are tied to specific outputs and are used to determine how and when those outputs can be spent. This model provides enhanced security and predictability for smart contracts compared to other blockchain models.
In essence, on-chain validator scripts are the core mechanism in Cardano’s smart contract system that ensure transactions follow the intended rules and logic defined by developers.
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