Kingdom of Knuffel

Yeah, I'm studying computer science :)

Awww, too bad jacob! But yeah, that's always a risk...
I don't know litecoins, but ethereum is actually one of the more interesting coins, we looked at the smart contracts part of it in a lecture last semester (where we studied how to verify them and what common flaws in the contracts are - and oh boy is that contract language inviting you to mess everything up...) :)

Well now I'm curious to see a sample contract....

smart contracts are basically just programs, they don't look all that different from other code. They're called that because the idea is that you can use them to enforce a classical contract, for example you could implement that as soon as person A sends piece of information x to person B, amount of ether (the currency) y gets transferred from B to A. So B couldn't cheat by receiving the information and then not paying up where in a classical situation A would have to take their contract document and go to court over it, because once they agreed on the smart contract, it just executes like that. At least in theory, unless they make a mistake (or one of them maliciously introduces a mistake they can benefit of that the other doesn't notice...). Unfortunately, mistakes are easy to make.

Huh! I see the idea behind that. If it works, that'd be very useful!

Well, I guess the idea is "save the lawyers and replace them by programmers and verification experts", so I should support the basic idea from a selfish point of view ;) Sounds like a lot of job opportunities, especially since verification is one of the areas I'm most interested in ;)
But yeah, I think the idea makes a lot of sense, but the implementation in ethereum still leaves some things to be desired. And it all only works as long as the underlying currencies manage to have some kind of stable value so you can really use them, which again I'm a bit doubtful about.

Smart contracts sound really handy in case of digital artistry, as the contract sees that the product is send there won't be any refund by the receiving party.
To many artist friends got screwed like that. :}

Well, the difficulty with art would be to assess whether the goods sent were actually what was agreed upon - because you also don't want people scamming others by pretending to be great artists (maybe using stolen art as their portfolio or whatever), taking comissions and then sending just some 5 minute paint drawing to make the contract think it is fulfilled. The kind of information you usually take in my example is something like a password that decrypts something where you have some kind of checksum or similar to see that it was actually the correct decryption of the encrypted thing person B had already received and had reason to believe was a thing he wanted to decrypt.

I see your point. There would be people that would use it to scam people.
And a decryption key could also work. Without the key the art is only a preview you can't do anything with, after the key you can use it.
There should be a way for it to work, I'm just not tech savey enough to see it. :}

Oh yes, you could certainly do something along the lines of:
A sends small resolution / heavily watermarked art over
B says they accept the art as fulfilling the contract
Money and actual full images get exchanged automatically

So yeah, you could probably use it for art in some way similar to that :)