Daml vs. Solidity: How to choose a smart contract language

Since the introduction of Web3 and blockchain, smart contracts have become a popular solution for securely executing transactions or binding agreements.

Smart contracts for the blockchain are created using Daml, Solidity, and other special programming languages. It can be challenging to choose the right programming language to build your smart contracts.

For example, Solidity is one of the most popular smart programming languages and objectively possesses more advantages over a language such as Daml. However, Daml offers many advantages that may make it a subjectively better choice for some businesses.

Let’s take a look at some similarities, distinctions, and use cases for Daml and Solidity to help you decide which one might be a better fit for your specific needs.

Here’s what we’ll cover in this article:

• What is Daml?
• What is Solidity?
• Similarities and distinctions between Daml and Solidity
• Factors to consider when comparing Daml and Solidity
• Use cases for Daml
• Use cases for Solidity

What is Daml?

Digital Asset Modeling Language (Daml) is a multiparty application platform from Digital Asset. The recent release of Daml 2.0 in March 2022 is stated to have “groundbreaking” capabilities for privacy and interoperability.

This open source smart contract language is used to create composable applications based on an abstract Daml ledger model. It also helps with agreement modeling and operates on several blockchain systems.

You can deploy Daml apps to both centralized databases and blockchain networks. These apps integrate smoothly with any infrastructure, whether for internal process optimization or forming consortia.

Thanks to its simple syntax, Daml helps developers concentrate on business logic and get to market faster. If you want to develop safe smart contracts quickly and with minimal effort, Daml is the way to go.

Smart contracts in Daml live in Daml ledgers. A Daml smart contract might be single-sided or multisided. The smart contract architecture in both situations can store facts, rights, and duties while imposing visibility restrictions on a need-to-know basis.

You can create and run Daml projects with VS Code and either the Daml SDK or webIDE.

Here is a Daml code sample:

choice NameOfChoice :
      () -- replace () with the actual return type
    with
    party : Party -- parameters here
  controller party
    do
      return () -- replace this line with the choice body

What is Solidity?

Solidity is a high-level object-oriented language for writing smart contracts. It is statically typed and is used within the Ethereum Virtual Machine (EVM). On the Ethereum network, Solidity can also be used to construct decentralized applications (DApps).

All code in Ethereum’s Solidity is written, compiled, deployed, and tested using Remix IDE. You can also use Remix IDE to perform debugging for Ethereum transactions.

Solidity code is easy to identify because it always starts with pragma followed by a number specifying the compiler version. For instance, pragma solidity ^0.8.10 indicates a Solidity file using the compiler version 0.8.10.

Here is a Solidity code sample:

// SPDX-License-Identifier: MIT
// compiler version must be greater than or equal to 0.8.10 and less than 0.9.0
pragma solidity ^0.8.10;

contract HelloWorld {
    string public greet  = "Hello World!";
}

Similarities and distinctions between Daml and Solidity

Daml and Solidity are both statically typed functional programming languages that are used to create smart contracts. Some differences between Daml and Solidity include their workflows, concepts of contracts, and flexibility of implementation.

When it comes to contracts, Daml uses an unspent transaction output (UTXO) model. This means in a Daml workflow, a contract is completed after it is triggered. Then, a new contract is formed with the new properties and holdings.

On the other hand, Solidity uses an account-based paradigm. This means in a Solidity workflow, operations on a contract affect the attributes and holdings of the underlying accounts while keeping the contract alive.

Finally, Daml can be implemented on a growing variety of platforms, including Amazon Aurora, VMware Concord, Hyperledger Fabric, and others.

In comparison, you would typically use Hardhat to develop and deploy Solidity smart contracts, with another popular tool being Truffle. Both of these require creating a deployment script.

Example smart contract written in Daml

The code block below demonstrates a simple Daml NFT contract that shows how users can use the NFT for other benefits, like a ticket to a concert or a voucher in a store.

template RockBandNFT
  with
    uniqueNFTId: Text
    imageUrl: Text
    band    : Party
    fan     : Party
    -- benefits  : Benefits
    issuedDate: Date
  where
    signatory band, fan

Example smart contract written in Solidity

The code block below demonstrates a simple Solidity storage contract where the user can store a value and retrieve it by calling the functions in the contract.

// SPDX-License-Identifier: GPL-3.0

pragma solidity >=0.7.0 <0.9.0;

/**
 * @title Storage
 * @dev Store & retrieve value in a variable
 * @custom:dev-run-script ./scripts/deploy_with_ethers.ts
 */
contract Storage {

    uint256 number;

    /**
     * @dev Store value in variable
     * @param num value to store
     */
    function store(uint256 num) public {
        number = num;
    }

    /**
     * @dev Return value
     * @return value of 'number'
     */
    function retrieve() public view returns (uint256){
        return number;
    }
}

As you can see, the code format for both smart contract languages differs significantly.

Only someone with coding experience will comprehend the Solidity sample code at a look. However, in Daml, keywords such as “where,” “with,” and “do” help explain the code to someone without coding or technical knowledge.

Factors to consider when comparing Daml and Solidity

There are many different factors you should consider when comparing Daml and Solidity. Understanding these factors is essential to picking the best option for your project. Read through some of these factors below.

Popularity

In terms of popularity, Solidity takes the victory. Since Solidity runs on the EVM, it has been gaining popularity alongside Ethereum. It is used in most popular projects and is considered one of the top programming languages for smart contracts.

Additionally, Solidity was released in August 2015, while Daml’s initial release was on 4 April 2019. In those few extra years, Solidity has established extensive documentation and wide community support, making it easy for newbies to get help.

Performance

Although both languages can be utilized for smart contracts, the decision to use one over the other comes down to the specific project you’re working on.

Daml allows you to concentrate on your project while it handles the logic. Data modeling, fine-grain permission, business logic, and scenario-based testing are the four components of a typical Daml code.

Daml also includes built-in functions that you would have to hardcode in Solidity. Although this would only take a few lines of code, it still gives Daml the advantage of being simpler.

However, Solidity includes libraries that make a developer’s job much easier — other than having to implement these libraries yourself to achieve the functionality you want, such as cloning smart contracts. These libraries include community-validated code and secure ready-to-use contracts.

Testing automation

Daml Script allows you to quickly test Daml models and receive feedback in Daml Studio. You can use Daml Studio to run Daml Script in a virtual ledger or an actual ledger for application scripting, automation logic testing, and ledger startup.

You must add the Daml Script library to the dependencies field in your daml.yaml file to gain access to the API used to implement Daml scripts.

To run a script, you must first build it with daml build. You can then run it by specifying the DAR, the script’s name, and the host and port on which the ledger is operating. The API needed to implement Daml scripts is defined by Daml script libraries.

In Solidity, there is no testing automation feature. You can only write and run unit tests manually.

Error handling

This is an important part of any development project. Any program, no matter how tiny, can have a large number of issues.

Error management in Daml is easy. Instead of aborting the transaction and rolling back the state changes that led to the error, Daml has an “Exceptions” feature, which manages specific errors that emerge during interpretation.

User-defined exceptions, throw, and try…catch blocks are some of the exceptions in Daml. It’s worth noting that exceptions can’t handle all errors.

Solidity errors can occur at either compile time or runtime. Compile-time errors are mainly syntax errors, while runtime errors occur during execution.

In Solidity, exceptions such as the assert function, the require function, revert statements, and try…catch statements are used to handle errors.

Both Daml and Solidity handle errors similarly. As a result, it is up to you to decide which language you want to use in your project when it comes to error management.

Easy to understand

Solidity code can be difficult to understand at first and may require the assistance of a developer. This is not the case with Daml code, which is easy to comprehend even for those who have never dealt with code before.

When explaining your codebase to your boss or a possible client, you will likely discover that they will find a Daml codebase much easier to understand than a Solidity codebase. This can help you maintain clarity across various teams without much technical expertise.

Although Daml is simple to comprehend, Solidity is still more widely used and popular. At the time of this writing, there are fewer resources and community support for Daml than for Solidity. This is highly useful when using Solidity since there are existing solutions to problems.

Flexibility

Daml code is considered a blockchain-agnostic language for smart contracts. It is compatible with various blockchains, including Hyperledger Fabric, Besu, Corda, VMware, and Daml Hub.

Examples of blockchains or distributed ledgers using Solidity include Tendermint, Binance Smart Chain, Ethereum Classic, Tron, Avalanche, CounterParty, Hedera, and IOTA. Solidity code works flawlessly on the Ethereum network.

Use cases for Daml

Developers using Daml can design clean, secure data models in a fraction of the time and with none of the errors that come with DIY bespoke development. You may want to use Daml if:

• You want to save time and allow developers to focus on application development
• You need flexibility in installation and integration
• You plan to incorporate Daml apps into existing systems
• You operate a multiparty workflow and need a smart contract that works on many blockchains

It is important to note that each firm operating a multi-party workflow must operate on the same blockchain and use a smart contract that is compatible with that blockchain.

Daml abstracts away the underlying blockchain infrastructure, allowing developers to concentrate on business logic and application development rather than interweaving technical code.

The following use cases may help demonstrate some ways in which Daml may be a better fit for your business.

Addressing evolving needs with Daml

Daml supports both centralized database and distributed ledger technology, giving it the flexibility to use any existing infrastructure. Companies using Daml can buy a single license for the underlying ledger or database, then migrate to any blockchain or database platform as their needs evolve.

You can also install Daml applications on any sort of storage system. The application will integrate with the underlying persistence layer seamlessly.

In addition, Daml supports on-premises, hybrid, and public cloud IT infrastructure. This makes it much easier to integrate new apps into existing business processes and data workflows.

Daml also communicates with other ledgers and Daml-powered applications, ensuring that businesses remain connected and no new silos are formed. You can incorporate Daml apps into existing systems easily using popular languages like JavaScript and Java.

On the other hand, Solidity contracts are immutable once deployed. No changes can be made to the contract, but it can be used by multiple UI that require the functions of the contract.

Tokenization and issuance using Daml

The key to changing procedures across financial systems is tokenization.

Any asset class may be tokenized using Daml, including NFTs. You can achieve this by directly integrating the asset’s rights and obligations into the token, along with modeling the workflows to completely automate the asset’s lifecycle across the financial ecosystem.

In Solidity, this may be done as an Ethereum Request For Comments 721 (ERC721) token. However, an ERC721 token is not the same as a Daml NFT; it is unable to run on the Ethereum blockchain because it is not a token standard in Ethereum.

Financial instrument lifecycle management with Daml

Financial instrument lifecycle management is often manual and uncoordinated, resulting in errors and delays.

With Daml’s built-in functions, modern enterprises can leverage automation and real-time transactions across a single source of truth. This can help decrease costs and modernize operations while maintaining counterparty privacy.

Daml readily establishes and precisely executes transactions based on life events. By doing so, it offers end-to-end lifecycle management for any type of financial instrument across any technology infrastructure.

This can also be done in Solidity, but you will have to hardcode everything.

Handling payments using Daml

Companies often rely on outdated systems to handle payments between themselves. Transfers are prone to delays and errors without an authoritative picture of data and transactions, while multinational businesses traverse a complex network of payment systems.

With its workflows, Daml smart contracts eliminate manual processes and facilitate a seamless transfer of assets.

On the other hand, Solidity may be more ideal for smart contracts in the banking and financial industry. Learn more about this Solidity use case below.

Use cases for Solidity

If you are concerned about security in your business, Solidity is a good choice.

While smart contracts are safe, they can be hacked and cause a firm to lose money. Most businesses are comfortable with Solidity because of its support system, security tools, and security testing environments.

Because Solidity is a widely used smart contract language, there are likely to be experts who have provided solutions to many types of security issues for others to adopt.

The following use cases may help demonstrate some ways in which Solidity may be a better fit for your business.

Handling payments using Solidity

As previously mentioned, Solidity smart contracts can be useful in the banking and financial industry. For example, you can use Solidity smart contracts to represent and enforce financial product or service restrictions.

In addition, Solidity smart contracts can make automatic payments, exchanges, settlements, and claims more convenient. They can also build mortgages, bonds, foreclosures, and loans that are based on blockchain technology.

Decentralized autonomous organizations with Solidity

Decentralized autonomous organizations (DAOs) in Solidity provide the opportunity for decentralized governance of numerous sorts of organizations. The leaders in these groups may be made up of anonymous persons. This may also apply to private companies and enterprises.

This can be accomplished in Daml, although the technique may be different and unreliable.

Building trustless DAO

Solidity DAO is fully trustless; once deployed, it can never be changed. In comparison, Daml does not completely support DAO natively. Daml contracts have signatories who can edit the contract, making them not fully trustless.

If you want to design a totally trustless DAO, Solidity is the way to go. While Daml can achieve trustless DAO, it is currently more difficult to build.

Game development

More developers are using Solidity for game production thanks to the profitability these games can achieve through NFTs and tokens. Solidity was used to create the majority of your popular blockchain games, such as Crypto Kitties.

At the time of this writing, Daml is not known for its use in game development.

Conclusion

Both Daml and Solidity offer pros and cons. They are both excellent options with characteristics appropriate for specific applications. One is not a substitute for the other, but each could be a viable option.

I encourage you to explore and compare both Daml vs. Solidity for yourself to gain better insight into which you prefer.