Developing Smart Contracts for Web3 Applications

Content

• Introduction
• Best Practices
• Security Consideration
• Documentation
• Testing and Debugging
• Gas Optimization
• Upgradability
• Lessons Learned From the Past
• Conclusion

Author

Sven

Chief Technical Officer (CTO)

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Introduction

In this article, we will continue our deep dive into Smart Contracts and how they empower Web3.

This time we will take a look at how to develop Smart Contracts, what you should pay attention to, and what you should avoid.

Best Practices

Security Consideration

When developing Smart Contracts you should make security your first priority. Embrace bug bounty programs that your community can use to find critical protocol flaws.

While developing Smart Contracts always keep vulnerabilities in mind and try to prevent them, by understanding the design patterns, such as check effects interaction, secure transferability, emergency Stops, and access restrictions.

Documentation

Keep detailed and organized documentation on proof-of-work and procedures. Your dev team might know the Smart Contracts inside and out, but having detailed and clear documentation will help reviewers and your community to understand the system better, its limitations, bugs and risks. Plus, it is important to keep real-time performance metrics and the status of code deployment.

Clear and thorough documentation can also enhance the user experience and prevent future confusion in regard to product usage. You can include instructions on what to do if the users found a bug or have some other technical issue in your Smart Contract documentation. It is also important to list the contact information of all concerned authorities (such as developers) so that they can be easily reached with a product-related issue or any other questions.

Testing and Debugging

To find style inconsistencies, code errors, and vulnerabilities that the compiler might have missed, use static analysis tools. You can find bugs and improper behavior by running QA cycles to verify best practices. Use a test framework that enables test interruptions to troubleshoot the test process and verify the contract’s current state.

High test coverage also gauges the effectiveness of your development and testing processes. It’s possible to have very low test coverage results or virtually no bugs that have been found, and vice versa. Security audits are another component of testing that assist in identifying knowns and unknowns through manual security audits.

Smart Contracts are the digital transaction gateway, and unlike other transactional gateways, they provide you with greater security and dependability. To find security requirements, you must delve deeper into your codebase. You can use free and open-source static analysis tools (like Ethersplay) which support dynamic jump computation, binary diffing, source code matching, and recovery methods.

Gas Optimization

In Web3 development, Gas is the unit of measurement that shows the amount of computational effort required to carry out specific operations on the blockchain. Therefore, Gas Optimization is the process of making your Smart Contract code less expensive to execute.

Upgradability

By design, Smart Contracts are immutable, which means that once you create them you cannot alter them in any way. However, you may want to modify a smart contract to address a bug, add new features, or simply change the rules it enforces.

So the way to upgrade a Smart Contract is rather convoluted and time-consuming. Here’s what you need to do:

1. Deploy a new version of your Smart Contract
2. Manually transition every state from the old contract to the new one (this can be quite costly, in terms of gas fees)
3. Update all contracts that interacted with the old version to interact with the new one
4. Reach out to every user and persuade them to begin using the new deployment (you will have to simultaneously use both contracts for some time, as users are slow to migrate)

As you can see, updating a Smart Contract takes some effort, however, you can use third-party plugins or solutions that allow you to modify your Smart Contract code without changing its address, state, or balance.
Pitfalls to Avoid When Developing Smart Contracts
Common Mistakes and Vulnerabilities

When designing Smart Contracts it is important to keep in mind the most common vulnerabilities to avoid, such as:

• Integer Arithmetic Errors
• Reentrancy Attacks
• Integer Overflow & Underflow
• Incorrect Calculation of the Output Token Amount
• Front Running Attacks
• Default Visibility
• Incorrect work with ERC-20 Token
• Time Component/Manipulation

In order to avoid these and other mistakes there are some steps you need to take:

1. Conduct an Audit – An audit can assist you in locating and removing weaknesses in your contract, optimizing gas consumption, assuring its accuracy and efficiency, and ultimately enhancing the performance of your source code as a whole. This makes it an essential element throughout any process of developing a smart contract!
2. Document Vulnerabilities and Security Practices – While you check your own contracts for any security flaws, documenting every smart contract issue can help you prevent them from happening. It’s always a good idea to double-check your code against existing ones after addressing all known security flaws to make sure you are not taking any unanticipated risks.
3. Internal Security Checks – Create an internal security team to regularly check the source code for potential bugs and make sure there are no openings that malicious hackers could use to compromise the security of your smart contracts.
4. Bug Bounty Program – After conducting a smart contract security audit, you can use a bug bounty program to further secure your smart contract. You can ensure an even higher standard of safety for the code base by doing this. Participants can find smart contract vulnerabilities through bug bounty programs and earn rewards for doing so, receiving compensation for successfully locating security flaws.
5. Security Monitor Tool – Using an alert service or deploying a tool that notifies you when someone on your blacklist tries to tinker with your smart contract is a good way to protect yourself from hackers.

Lessons Learned From the Past

Blockchain technology is still in its early stages, however, there are already some lessons to be learned from the past. One of the most critical lessons is the importance of thoroughly testing and auditing smart contracts before deployment. This can help prevent issues such as code vulnerabilities and security breaches. Additionally, developers need to understand the unique features and limitations of blockchain technology to design a suitable architecture that can scale and handle transaction fees effectively. Maintaining transparency and open communication with stakeholders throughout the development process is crucial as well.

Conclusion

Smart Contracts enable blockchain to reach enormous potential, but a lot of attention is needed to be paid in the process of development. Prioritizing security and open communication with your community is key when developing a smart contract. It is also important to be aware of what is happening in the industry as a whole. By learning from past mistakes and experiences, developers can build more robust and secure smart contracts that can help drive the adoption of blockchain technology.

Red Pill has extensive experience in creating robust and optimized Smart Contracts for dApps. Contact us if your project needs a custom-developed Smart Contract:
https://redpilldev.tech/contacts/