Smart contracts are a game-changing technology that has come a long way from their initial introduction in the late 1990s. Smart contracts went from an abstract concept to a physical reality with the launch of Ethereum in 2015. Smart contracts, in essence, are self-executing contracts in which terms are encoded directly into code. They are kept and copied on the blockchain, where they provide transparency, immutability, and deterministic execution.

The evolution of software development paradigms can help us understand smart contract development. The emphasis in the 1990s was on client/server applications, but as time passed, the architecture developed to a more layered approach. Smart contracts first combined the business logic and data layers into a single layer published on the blockchain.

However, this strategy has drawbacks, particularly in terms of scalability and performance. The first smart contract concept is designed for unstable public networks, but it can be slow and inefficient in inter-enterprise scenarios in reliable or semi-reliable environments.

The notion of Cryptlets was established to provide program architects more flexibility and options. Cryptlets are blocks of code that run inside a container, removing sophisticated business logic from the blockchain execution route. This separation of concerns enables developers to work in their preferred languages and deploy each component of the smart contract in a suitable environment.

Cryptocurrencies create a new implicit trust model in which things are executed in a secure environment with a known identity, producing cryptographic verification of all their results. This trust model can be used to both public and semi-trusted networks, resulting in the creation of a third domain that spans both types of networks.

Choice, flexibility, scalability, and the ability to version logic independently of data and schema are all advantages of this new architecture. It also makes secrecy easier and allows for mobility between blockchains.

Smart contracts, in summary, may be deconstructed into layers and implemented in independent tiers, allowing for a scalable and flexible approach to blockchain application development. The implementation is a decision that may be adjusted to the individual needs and requirements of the application, whether it is a 100% on-chain smart contract or a combination of blockchain schema and Cryptlets.