Pre-Approved Contract

PreviousDefault Escrow Contract NextTokenomics

Last updated 2 years ago

Was this helpful?

Pre-Approved Contract

Pre-approved escrow contract, also known as an item contract, is a smart contract for a specific product or service with the description of its escrow terms (delivery and inspection time, EVM network, currency and amount, etc.)

It is created by the seller and is displayed as an item on the seller's profile page. It is specifically designed for marketplace sellers to add items (products, services, assets) to their profiles, and sell to multiple buyers from one contract.

Unlike another type, default escrow contract, only the seller can create pre-approved contracts. The contracts are displayed as items on the seller's profile page (as in the online market).

Similar to the default escrow contract, item contract terms describe the product/service quality, its delivery and inspection time, accepted network(s), and token(s). However, these contracts will also display an item image and a set price. Buyers are also given the choice of networks and tokens to pay.

Just like the default contract, a pre-approved contract follows the commands given by its participants known as contract actions. Their completion changes the contract state and allows a full contract cycle (from creation to execution).

To clarify how pre-approved contracts work below is the sample contract workflow - from item contract creation to its execution (1 purchase of an item).

How pre-approved contracts work

Step 1. The Seller creates an item (product/service/asset) to sell.

The Seller logs in via web3 wallet (MetaMask) and clicks "My Items" from the left panel. Then, clicks "Add item".

Fills out the form adding the item name, description, delivery, and buyer protection time (time for inspection upon receiving the order).

Then, sets the price and selects acceptable network(s) and token(s). There are two checkboxes at the bottom of the page - for one-off items and pre-approved items.

One-off items can only be sold once (original and not reproducible artwork, a particular website, etc.) Items that are pre-approved by the Seller do not require manual approval and allow buyers to deploy contracts immediately.

In our example of reproducible landscape art, we leave the first box unchecked. Also, since we want multiple people to buy the item without waiting for our (seller's) approval every time, we check the second box.

The Seller clicks "Add" and waits for moderator approval (usually 2 - 12 hours).

Step 2. The Seller checks the profile to see the new item and its details.

The Seller clicks on the user icon and selects "Profile". Once approved by the moderator, the new item will appear on the Profile page under the "Items" tab. Clicking on the item displays its details.

If necessary, items can be edited (note that all changes undergo moderation).

Step 3. The Buyer goes to the Seller's page and purchases the item.

The Buyer logs in via MetaMask and enters the Seller's address into the address bar (example: https://beta.zen.land/profile/0x9ca6201387e13620c69b3b09af47ef1665d80fbf).

Then, clicks on the item to see the details. Next, the Buyer selects the network and token and clicks "Buy". The contract with the Seller and the Buyer addresses and terms is created, and the Buyer approves it.

Step 4. The Buyer sends the contract to the blockchain and locks payment inside.

The Buyer deploys the approved item contract to the chosen blockchain network and transfers the payment inside.

All contract operations are done from the Control page following contract actions, such as "Deploy" and "Transfer". Both actions are blockchain transactions and will require a gas fee to execute the commands.

Step 5. The Seller completes the order (delivers the product/service/asset to the Buyer).

The Seller checks the contract address 0x63443e62d52b42229a06319c5ebdf9ba91aa0dd7 via Etherscan (or another applicable explorer) to verify that the payment is inside the contract.

Then, sends the file to the Buyer and confirms the order completion by clicking the "Complete" button.

24- hour inspection time (buyer protection time) starts.

Step 6. The Buyer releases payment to the Seller.

The Buyer checks the order, and releases the payment to the Seller's address by clicking "Release".