# Core Contracts

Smart contracts are the backbone of Laika's L2 network, deployed on the Laika L2 chain. They play a critical role in governing network logic, managing state data, and enforcing security rules. This section explores the functionalities and functionalities of smart contracts on Laika.

**Responsibilities**

Laika smart contracts handle a variety of critical tasks:

* **Network Governance:** Smart contracts define and enforce the core rules governing the Laika network. They dictate aspects like transaction fees, validator selection criteria, and reward distribution mechanisms.
* **State Management:** Smart contracts track and maintain the current state of the Laika network, including user balances, transaction history, and validator information. This ensures all participants operate on the same consistent data set.
* **Security Enforcement:** Smart contracts implement security protocols to safeguard the network. They validate transactions, verify proofs submitted by sequencers, and prevent malicious activities.
* **Verifiable Transactions:** Laika smart contracts ensure all L2 transactions are verifiable on the L1 (Dogecoin) blockchain. This enhances trust and transparency in the network.
* **On-Chain Governance:** Smart contracts facilitate Laika's on-chain governance system. Laika token holders can propose changes to network parameters through voting mechanisms implemented within these contracts.
